Asian markets were volatile on Wednesday as investors tried to figure out the Federal Reserve’s interest rate plans, while oil prices struggled to recover from the previous day’s losses on demand concerns.
Thank you for reading this post, don't forget to subscribe!While Wall Street enjoyed another uptrend, there were few catalysts to drive trade, and with geopolitical tensions relatively low, US monetary policy is in focus after the central bank signaled no further tightening last week. Is.
However, officials are refusing to make any commitments right now, instead saying they want to see more evidence that inflation is indeed on a downward path and the labor market has softened significantly.
Friday’s data showed that jobs creation was slowing – but not enough to cause concern about the economy – giving confidence that the Fed is on course to deliver a soft landing for the economy and avoid a recession. Is increasing.
Chicago Fed boss Austin Goolsbee gave little insight on Tuesday, saying only that he was focusing on getting prices under control.
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“We have to get inflation down — that’s the number one thing,” he told CNBC. “I absolutely think that’s something we should keep an eye on.”
He said it seems possible to do this without harming the economy.
“To get inflation as low as we are without having a major recession, that’s basically never happened,” he said.
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“But because of some of the strangeness of this moment, the golden path is likely, that we’ll get inflation down without a recession.”
All three major indexes in New York edged higher, with the S&P 500 up for a seventh straight day, having slipped into correction territory after a 10 percent slide from its recent high last month.
But Asian investors were more cautious, with some markets moving in and out of positive territory.
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Tokyo, Hong Kong, Shanghai, Sydney and Taipei rose, while Singapore, Seoul, Wellington, Manila and Jakarta fell.
Still, analysts are bullish on the equity outlook.
Solita Marcelli at UBS Global Wealth Management said the latest surge in shares was “consistent with our view that investor pessimism has gone too far”.
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“Although we continue to see near-term headwinds for equities, we believe conditions remain in place for positive total returns over the next six to 12 months.”
Observers said continued weakness in oil prices would make it much easier to fight inflation, which was a key driver of last year’s surge.
Both main contracts, which have retreated as the Israel-Hamas conflict shows no signs of spreading into the wider Middle East, sank more than four percent on Tuesday after a warning that demand would fall next year.
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The US government report said that per capita demand has reached a 20-year low.
But National Australia Bank’s Tapas Strickland said “the physical market appears to be well oversupplied at the moment, with several reports reporting Russian crude shipments at a four-month high, China trade data inconclusive. “Demand prospects are highlighted, and OPEC+ countries are exporting more than recent production cuts”.
TOKYO – Nikkei 225: up 0.2 percent at 32,329.39 (break)
Hong Kong – Hang Seng index: up 0.3 percent at 17,717.80
SHANGHAI – COMPOSITE: up 0.2 percent at 3,061.88
Dollar/yen: At 150.43 yen from 150.38 yen on Tuesday
EUR/USD: Drops to $1.0697 from $1.0701
Pound/Dollar: Down from $1.2297 to $1.2293
Euro/pound: up from 86.99 pence to 87.02 pence
West Texas Intermediate: Flat at $77.34 per barrel
Brent North Sea crude: up 0.2 percent at $ 81.77 per barrel
New York – Dow: up 0.2 percent at 34,152.60 (close)
LONDON – FTSE 100: down 0.1 percent at 7,410.04 (close)
dan/cwl
Source: www.barrons.com
