Share markets gripped by caution as U.S. inflation data awaited By

(Corrects name of strategist in opening quote)

By Tom Arnold and Scott Murdoch

LONDON/HONG KONG (Reuters) – World share markets barely moved and the dollar held steady on Tuesday, as investors awaited U.S inflation data for more clues on the health of the world’s largest economy and when the Federal Reserve could start to taper stimulus.

Fears that inflation may prove more prolonged than central bankers expect have kept stocks down so far in September after seven-months of gains, spurred by the global economy’s recovery from the COVID-19 pandemic.

European shares were 0.3% lower, with luxury shares tracking their Asian peers down on concerns about the spread of COVID-19 cases in China.

MSCI’s world stocks benchmark was flat.

In the U.S., futures signalled a slightly negative opening.

“Right now, investors are more cautious then they have been. September tends to be a weaker month historically for equity prices,” Credit Suisse (SIX:)’s senior investment strategist Suresh Tantia said.

“Equity prices have been very high, so clients are more cautious now. There is the prospect of Fed tapering in the next 2 to 3 months and that is a negative catalyst for markets.”

In Asia, China’s tightening grip on its technology companies and a widening liquidity crisis for the country’s most indebted developer again kept investors on edge.

MSCI’s broadest index of Asia-Pacific shares outside Japan was down 0.4%.

Hong Kong’s sank 1.4%, with shares of developer China Evergrande Group slumping to the lowest point since 2014 after it said it had appointed financial advisers to examine its capital structure.

The company also said sales would fall again in August due to concerns over its debt which would hurt its liquidity and cash flow.. Evergrande shares were down 11.6% .

China’s blue-chip CSI300 index lost 1.5%.

China’s technology stocks are also being closely scrutinised after authorities told the country’s tech giants to stop blocking each other’s links on their sites.

The directive was the latest in a string of tightening regulations that has dragged down the Hang Seng Tech Index by nearly 40% since its peak this year in February.

The Nasdaq Golden Dragon China Index, which tracks Chinese companies listed in the United States, fell 1.1% on Monday, to take its decline over the past six months to 35.5%.

“We are still concerned about the regulations, what they mean and how they will be rolled out, but with the correction that is underway, that means there is some value in certain parts of the Chinese equities market,” Luke Moore, Oreana Financial Services chief executive, told Reuters.

“We don’t see an end in sight to the changes yet, we think the uncertainty is going to continue and everyone is looking for clarity on how far the regulations will go and what could be next.”

A fresh…