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Brunei
Thursday, September 29, 2022
32.5 C
Brunei
Thursday, September 29, 2022
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    World shares mostly higher ahead of US price data

    BANGKOK (AP) — World shares were mostly higher yesterday as investors awaited new United States (US) inflation data.

    Benchmarks rose in Paris, Frankfurt and Hong Kong but were flat in Tokyo and Shanghai.

    Fresh data on inflation will come today with the release of the Federal Reserve’s preferred gauge. It will cover May, when the consumer price index saw year-over-year inflation of five per cent.

    Germany’s DAX gained 0.6 per cent to 15,547.75 and the CAC 40 in Paris picked up 0.7 per cent to 6,599.78. In Britain, the FTSE 100 added 0.2 per cent to 7,084.64.

    US futures were higher after a bipartisan group of US senators proposed a pared-down plan for USD559 billion in new infrastructure spending that could open the door to President Joe Biden’s more sweeping USD4 trillion proposals.

    Biden invited members of the group to the White House yesterday to discuss the USD953 billion infrastructure plan.

    A currency trader watches monitors at the foreign exchange dealing room of the KEB Hana Bank headquarters in Seoul. PHOTO: AP

    The futures for both the Dow industrials and the S&P 500 gained 0.5 per cent.

    Markets have calmed notably since the Federal Reserve surprised investors last week by saying it could start raising short-term interest rates by late 2023, earlier than expected, if recent high inflation persists.

    The super-low rates the Fed engineered to carry the economy through the pandemic have propped up prices across markets, and any change would be a big deal, so the Fed’s announcement triggered selling of stocks and a rise in Treasury yields.

    Tokyo’s Nikkei 225 index was flat at 28,875.23 and Hong Kong’s Hang Seng edged 0.2 per cent higher to 28,882.46. In Seoul, the Kospi added 0.3 per cent to 3,286.10.

    The Shanghai Composite index was virtually unchanged at 3,566.65, while Sydney’s S&P/ASX 200 declined 0.2 per cent to 7,275.30.

    Shares rose in India and Taiwan but fell in Southeast Asia.

    On Wednesday, the S&P 500 slipped 0.1 per cent to 4,241.84 after meandering between very modest gains and losses. It’s 0.3 per cent below its record high set a week and a half ago.

    The Dow Jones Industrial Average fell 0.2 per cent to 33,874.24, while the Nasdaq composite added to its record set a day before, inching up 0.1 per cent to 14,271.73.

    Most stocks in the S&P 500 fell, but gains for financial companies and others that do best when the economy is healthy helped limit the losses.

    If higher inflation continues, the central bank will have to get more aggressive about raising rates. But before that, it will likely first have to reduce the bond purchases it’s making to keep longer-term interest rates low. Then it will actually begin tapering, before ending tapering and then signalling that a rate hike is coming.

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