Equities: Stagflation fears weigh on US stocks – Deutsche Bank

Deutsche Bank strategists have highlighted how escalating oil prices are exacerbating stagflation worries and negatively impacting equities worldwide. The S&P 500 experienced its most disappointing day of August thus far, with market breadth weakening significantly. Meanwhile, European shares and Asian markets also saw declines, causing a ripple effect of negative momentum.

Brent crude oil surged to close above $90 per barrel for the first time in two weeks, triggering pressure across the board and leading to further declines in both the S&P 500 and futures. The S&P 500 suffered its worst day of August so far, with the index down 0.52%, while the equal-weighted index also reached its worst daily performance in over a month.

European markets closed lower, but the STOXX 600 continued its fourth consecutive decline. Asian indices followed a similar downward trend, with notable losses in Nikkei, KOSPI, Hang Seng, CSI 300, and Shanghai Comp. UK labor data, which showed 4.9% unemployment rate and 83K employment change, added to the pressure on the British Pound.

Gold saw modest losses below $4,400, while the US Dollar's recent bounce from a two-month low was influenced by inflation concerns arising from higher oil prices. Ripple and Stellar faced pressure due to broader market uncertainty and weak technical momentum, leaving both cryptocurrencies vulnerable to further declines.