Stocks slip, dollar gains on rate outlook jitters

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Key Points

LONDON/SINGAPORE (Reuters) World shares slipped and the dollar and U.S. bond yields rose on Tuesday as hawkish remarks from central bank policymakers in Europe contributed to markets reducing bets that global interest rate cuts could come as early as March...

Europes STOXX 600 index and MSCIs broadest index of Asia-Pacific shares outside Japan both dropped to their lowest since mid December, with the broad European benchmark last down about 0.5%, moving further away from a two-year peak at the start of January...

Gains in stocks were underpinned by sharp declines in bond yields in November and December as investors brought forward expectations of rate cuts by central banks...

Contributing to those revisions, European Central Bank officials have been out in force this week, with hawkish speakers such as Bundesbank president Joachim Nagel on Monday pushing back firmly on expectations of rate cuts...

The pound was another underperformer in currency markets down 0.66% against the dollar at $1.2643 after data showed that growth in British wages slowed in the three months through November, supporting the idea that the Bank of England will cut interest rates sharply this year...

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