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Asian stocks follow Wall Street on hopes of Fed interest rate moratorium

Asian stocks also followed Wall Street higher on Wednesday as weaker US inflation data raised hopes that the Federal Reserve would not raise rates in June.

Japan’s benchmark TOPIX index rose 1.4%, China’s Shanghai and Shenzhen-listed CSI 300 index rose 0.5%, and Australia’s S&P/ASX 200 index rose 0.3%. .

These gains came after the benchmark S&P 500 index 0.7% increase In addition, the Nasdaq Composite Index, which focuses on tech stocks, also rose on the same day, as US consumer price data showed that headline inflation rose 4% in May compared to the same month last year, down from about 5% in April. increased by 0.8%.

Investors said the Fed could tighten policy again in July, but weak inflation data has led the market to expect the Fed to keep rates unchanged at the end of Wednesday’s monetary policy meeting. strengthened.

“Our forecast is that the Fed will keep rates on hold in line with market prices,” said Solita Marcelli, chief investment officer for the Americas at UBS Global Wealth Management. “However, policymakers also hope to send a clear message to the market at their upcoming meeting that at least one more rate hike is likely.”

Economists still expect the European Central Bank to raise deposit rates by another 0.25 percentage points at its meeting on Thursday.

Chinese stocks rose Rising expectations for policy support The loans from the People’s Bank of China came after the People’s Bank of China cut short-term lending rates for the first time in nine months on Tuesday.

Analysts at Goldman Sachs said the move “could signal the start of further monetary easing” and expected the central bank to cut the one-year medium-term lending rate by 0.1 percentage point on Thursday. are doing. This rate acts as a floor for China’s benchmark prime loan rates.

Futures markets had expected the S&P 500 index to start flat in the second half of the day, while the FTSE 100 index was expected to fall 0.2%.

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Asian stocks also followed Wall Street higher on Wednesday as weaker US inflation data raised hopes that the Federal Reserve would not raise rates in June.Japan’s benchmark TOPIX index rose 1.4%, China’s Shanghai and Shenzhen-listed CSI 300 index rose 0.5%, and Australia’s S&P/ASX 200 index rose 0.3%. . These gains came after the benchmark S&P 500 index 0.7% increase In addition, the Nasdaq Composite Index, which focuses on tech stocks, also rose on the same day, as US consumer price data showed that headline inflation rose 4% in May compared to the same month last year, down from about 5% in April. increased by 0.8%.Investors said the Fed could tighten policy again in July, but weak inflation data has led the market to expect the Fed to keep rates unchanged at the end of Wednesday’s monetary policy meeting. strengthened.”Our forecast is that the Fed will keep rates on hold in line with market prices,” said Solita Marcelli, chief investment officer for the Americas at UBS Global Wealth Management. “However, policymakers also hope to send a clear message to the market at their upcoming meeting that at least one more rate hike is likely.”

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Economists still expect the European Central Bank to raise deposit rates by another 0.25 percentage points at its meeting on Thursday.Chinese stocks rose Rising expectations for policy support The loans from the People’s Bank of China came after the People’s Bank of China cut short-term lending rates for the first time in nine months on Tuesday.Analysts at Goldman Sachs said the move “could signal the start of further monetary easing” and expected the central bank to cut the one-year medium-term lending rate by 0.1 percentage point on Thursday. are doing. This rate acts as a floor for China’s benchmark prime loan rates.Futures markets had expected the S&P 500 index to start flat in the second half of the day, while the FTSE 100 index was expected to fall 0.2%.
https://www.ft.com/content/391e605c-73de-42b0-8871-77690d67fe38 Asian stocks follow Wall Street on hopes of Fed interest rate moratorium

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