Friday, 29 March 2024

Stocks extend winning run on optimism inflation peakingStocks extend winning run on optimism inflation peaking

FacebookTwitterWhatsAppTelegram

اقرأ المزيد

Asian stocks advanced on Tuesday and the dollar steadied below a recent peak ahead of U.S. inflation data that some strategists said could offer another signal that inflation has peaked, Reuters reported.
S&P 500 futures ESc1 and Nasdaq futures NQc1 held firm, while European stock futures STXEc1 dipped, setting the stage for a subdued start for European markets.
MSCI’s broadest index of Asia-Pacific shares ex-Japan .MIAPJ0000PUS rose 0.8%, led by a 2.6% jump for South Korea’s KOSPI .KS11. Japan’s Nikkei .N225 put on 0.2%. .KS.T
The MSCI gauge has risen for four days in a row, bouncing back from two-year lows.
Analysts, however, warned that U.S. core inflation is likely to march on and that the near-term rate implications are unclear.
“It’s too early to be celebrating the end of inflation, as some market participants seem already to be doing,” said ING economist Rob Carnell.
U.S. crude CLc1 is hovering below $90 a barrel, down nearly 30% since the middle of June and roughly where it traded before Russia’s invasion of Ukraine.
Interest rate futures imply a 90% chance that the Federal Reserve lifts its benchmark interest rate by 75 basis points at next week’s policy meeting – a position that is perhaps most vulnerable to a downside CPI surprise.
“A further cooling in inflation would support the case for a step down in the pace of policy tightening to a 50 basis points rate hike at the FOMC meeting next week,” said Kristina Clifton, a senior economist at CBA.
“Nevertheless, an upside surprise to inflation will easily cement market expectations of another outsized 75 basis points rate hike.”
Asia data out on Tuesday offered a cloudy picture of regional economies. A 9% year-on-year jump in Japanese wholesale prices points to pressure on corporate margins, yet a slowdown in gains for August holds some hope of relief.
In New Zealand, rate hikes which began a year ago are starting to bite, sending home prices down 6% since last August.
The investment banking world is also offering a counterpoint to stock markets’ enthusiasm. Goldman Sachs GS.N is mulling job cuts, a person familiar with the plans told Reuters.
A KKR-led KKR.N consortium has told Australia’s Ramsay Health Care RHC.AX it will not improve its $14.5 billion cash-and-stock offer for the hospital operator, a move that will likely put a deal on ice.

Related



More