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January 12, 2022

Global Stocks, Wall Stups After Powell’s Rate Hike | Nation World News

BEIJING ( Associated Press) – Federal Reserve Chairman Jerome Powell said global stocks and Wall Street futures advanced on Wednesday, with US monetary policy returning to normal and interest rates could be raised earlier than planned.

London and Frankfurt opened higher. Shanghai, Tokyo and Sydney followed.

Wall Street’s benchmark S&P 500 index rose 0.9% on Tuesday after Powell said The policy will “in all likelihood” normalize as bond purchases and other incentives wind down. Speaking before the Senate Banking Committee, he said ultra-low rates could be raised earlier than planned if needed to cool inflation to a four-decade high.

“Wall Street now has a better understanding of how the Fed will normalize policy,” Oanda’s Edward Moya said in a report. “Following Powell’s testimony, some investors feel they have a clear indication to buy the dip.”

The FTSE 100 in London rose 0.5% to 7,529.16 in early trade. The DAX rose 1.1% to 15,941.81 in Frankfurt. The CAC 40 in Paris rose 1% to 7,183.38.

On Wall Street, futures for the benchmark S&P 500 index and the Dow Jones Industrial Average were up 0.2%.

On Tuesday, the S&P 500 broke a five-day chain of decline and gained 0.9%. The Dow gained 0.5% and the Nasdaq Composite up 1.4%.

In Asia, the Shanghai Composite Index rose 0.8% to 3,595.12 and the Nikkei 225 in Tokyo rose 1.9% to 28,765.66. The Hang Seng in Hong Kong rose 2.6% to 24,354.68.

In Seoul, the Kospi rose 1.5% to 2,972.48 and Sydney’s S&P-ASX 200 rose 0.7% to 7,438.90.

India’s Sensex opened 0.8% higher at 61,102.89. New Zealand retreated while Southeast Asian markets rose.

Investors were shocked in mid-December when Fed officials said they would accelerate a plan to ease the stimulus that boosted stock prices. They are trying to figure out how the world’s largest economy and financial markets will react.

Also on Tuesday the World Bank cut its forecast Inflation was fueled by supply chain disruptions for global economic growth this year from 4.3% to 4.1%. The agency estimates the world economy to grow by 5.5% in 2021.

The US government is due to report consumer inflation on Wednesday. This is followed by the Wholesale Price Index on Thursday.

In energy markets, benchmark US crude rose 2 cents to $81.24 a barrel in electronic trading on the New York Mercantile Exchange. The contract rose $2.99 ​​to $81.22 on Tuesday. Brent crude, used as the price base for international oils, fell 11 cents to $83.61 a barrel in London. It rose by $2.85 to $83.72 in the previous session.

The dollar fell to 115.34 yen from Tuesday’s 115.37 yen. The euro fell from $1.1366 to $1.1364.

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