Stocks head for weekly loss as US election nerves mount

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LONDON/TOKYO, Oct 25 - Global stocks were set to end the week lower as looming U.S data and Japan's weekend election curbed a rally already knocked off course by the close-run race for the White House and expectations the Federal Reserve will resist rapid rate cuts.U.S.

Markets have tilted towards Donald Trump returning to the White House, driving Wall Street stocks to record highs earlier this month on bets that business tax cuts would shield the economy from additional inflation triggered by his proposed import tariff hikes. Britain's 10-year gilt yield , at 4.227%, is up 17 basis points this week amid fears of disorderly moves around the Oct. 30 budget, where finance minister Rachel Reeves has hinted she may loosen debt rules to increase borrowing.Various gauges of market caution have risen this week, with the ,index of bond market volatility close to its highest point in a year while a measure of anticipated euro volatility hit an 18-month high on Thursday.

The Fed cut borrowing costs by 50 bps in September in its first such move since 2020, but money markets have dropped earlier bets for another jumbo move next month, with most traders anticipating a quarter point reduction instead.

 

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