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Friday, December 09, 2022

Inflation worries cloudy outlook on fall in global stocks

TOKYO ( Associated Press) – Global stocks fell on Tuesday as concerns over inflation dampened optimism over President Joe Biden’s remarks that he was considering reducing US tariffs on Chinese imports.

European shares fell in early trade, with France’s CAC 40 down 1.3% at 6,275.73. Germany’s DAX fell nearly 1.0% to 14,038.93, while Britain’s FTSE 100 was down 0.7% at 7,460.16. The Dow Industrials’ future was down 0.8% while the S&P 500’s future slipped 1.3%.

On Monday, the S&P 500 rose 1.9%, the Dow Jones Industrial Average 2% and the Nasdaq 1.6%. The Russell 2000 rose 1.1%.

Biden, who announced a new economic and trade initiative Along this area during a trip to Japan, confirmed to reporters that he planned to discuss the issue of punitive tariffs imposed on China upon his return to Washington with Treasury Secretary Janet Yellen during former President Donald Trump’s administration.

“I’m talking to the secretary when I get home. We’re looking at it,” Biden said.

The comments sparked optimism over the potential to ease tensions between the world’s two largest economies, but not all were convinced.

“Talks about reducing tariffs on Chinese exports have surfaced in the past and the lack of any concrete follow-up remains an element of gloom for markets,” said Yep Jun Rong, market strategist at IG in Singapore.

Biden joined the leaders of Japan, Australia and India in Tokyo for the summit of the “quad,” or quadrilateral security talks, where Biden made the case that the world has a shared responsibility for aiding the Ukrainian resistance against Russia’s aggression. . The summit took place on the last day of Biden’s first visit to Asia as president.

Investors are watching the impact of the war in Ukraine on commodity prices and a possible blow to global economic growth from the pandemic lockdown in China.,

Japan’s benchmark Nikkei 225 fell 0.9% to close at 26,748.14. Australia’s S&P/ASX 200 fell 0.3% to 7,128.80, and South Korea’s Kospi fell 1.6% to 2,605.87. Hong Kong’s Hang Seng fell 1.8% to 20,112.10, while the Shanghai Composite fell 2.4% to 3,070.93.

Investors fear the US central bank may go too far or too fast in raising rates. This can slow down business activity and potentially lead to a recession. On Wednesday, investors will get a more detailed glimpse into the Fed’s decision-making process with the release of minutes from the latest policymaking meeting.

Technology stocks that have made huge gains during the pandemic are now facing the brunt of selling because of their steep prices. Casting a shadow, social media and camera maker Snap Inc. stunned investors with a warning late Monday.

“Snap’s share price snapped, crackle, popped,” said Oanda’s Jeffrey Haley, as the expanded business plunged more than 30% after the CEO said in a note to employees that it was reporting quarterly on growth and revenue. Will miss the guidance.” vaccine.

Shares of Snap were down 28% at $22.47 in premarket trading early Tuesday.

Wall Street will receive some economic updates from the Department of Commerce this week. On Thursday it will release a report on GDP for the first quarter and on Friday it will release data on personal income and spending for April.

In energy trading, US benchmark crude fell 75 cents to $109.54 a barrel in electronic trading on the New York Mercantile Exchange. On Monday, it rose 1 per cent to $110.29 a barrel. Brent crude, the international standard for pricing, fell 83 cents to $112.59 a barrel.

In currency trading, the US dollar fell from 127.78 yen to 127.37 Japanese yen. Euro price is $1.0717, higher than $1.0688.

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