Global Equities Pull Back as Inflation Hints at Fed Rate Hike | Your money


BANGKOK (AP) – Stocks were mostly down in Asia on Thursday after the latest report on the surge in prices in the United States appeared to keep the Federal Reserve on track to raise interest rates in the coming months.

London, Paris, Tokyo and Shanghai were down while Sydney and Hong Kong were up.

The surge in coronavirus cases has raised uncertainties about the pace of the recovery from the pandemic.

Britain and Germany have suffered severe waves of the highly contagious omicron variant of the coronavirus. France is at the epicenter of Europe’s current fight against COVID-19, with new infections exceeding 360,000 per day in recent days.

The German DAX fell 0.2% to 15,973.58 while the CAC 40 in Paris fell 0.6% to 7,196.23. In Britain, the FTSE 100 lost 0.3% to 7,533.13. On Wall Street, S&P 500 and Dow futures fell less than 0.1%.

In Asia, the omicron variant has swept Australia and is gaining traction in other countries despite high vaccination rates, mask requirements and strict border policies. Japan reported more than 13,000 new infections on Wednesday, the highest level in four months. China, of which Zero COVID policies are called into question by epidemics just a few weeks before the Beijing Winter Games, tests and, in some cases, locks entire cities.

Tokyo’s Nikkei 225 index fell 1% to 28,489.13, while the Shanghai Composite fell 1.2% to 3,555.26. In Seoul, the Kospi lost 0.4% to 2,962.09.

The Hang Seng in Hong Kong rose 0.1% to 24,429.77 and the S & P / ASX 200 in Australia rose 0.5% to 7,474.40. The Indian Sensex index fell 0.1%.

Taiwan’s benchmark rose 0.3% after TSMC, the world’s largest processor of computer chips, reported a record quarterly profit of just over $ 6 billion.

The 10-year Treasury yield remained stable at 1.74%.

Besides the direct impact of large coronavirus outbreaks on normal business activity, the ripple effects on manufacturing and shipping could further hamper a rebound from the past two years of disruption.

“So far, the market reaction to the omicron wave has been subdued, but attention should be paid to concerns about other impacts on global supply chains that could trigger risk-free trade,” he said. ActivTtrades’ Anderson Alves said in a report.

On Wednesday, the S&P 500 rose 0.3%; the Dow Jones Industrial Average posted a gain of 0.1% and the Nasdaq composite rose 0.2%. The Russell 2000 Index fell 0.8%.

Investors focused on a report from the Ministry of Labor, which showed consumer prices jumped 7% last month. This is the fastest year-over-year pace of the Consumer Price Index in nearly four decades. The big hike, in line with economists’ forecasts, came a day after Fed Chairman Jerome Powell told Congress the central bank was ready to hike rates to fight inflation.

Wall Street was closely monitor rising inflation to assess the impact on businesses and consumers, as well as the Fed’s plan to reduce its support for the economy and the markets.

Companies in many industries passed the higher costs on to consumers, but warned they would still feel a financial impact due to rising prices and supply chain issues.

Wall Street will receive another update on rising inflation on Thursday, when the Labor Department releases December results from an index based on U.S. wholesale prices. It shows how inflation affects costs for businesses.

Investors are also watching the latest round of results closely to see how companies are dealing with inflation.

Delta Air Lines publishes its results Thursday. Citigroup, JPMorgan Chase and Wells Fargo report their results on Friday.

In other trading Thursday, benchmark US crude oil fell 19 cents to $ 82.45 a barrel in electronic trading on the New York Mercantile Exchange. It gained $ 1.42 to $ 82.64 a barrel on Wednesday.

Brent crude, the base of international oil prices, fell 15 cents to $ 84.52 a barrel.

The US dollar fell to 114.58 Japanese yen from 114.64 yen. The euro fell from $ 1.1444 to $ 1.1469.

Inflation at 40 puts pressure on consumers, the Fed and Biden

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