Asian markets rose on Tuesday after a new record high on Wall Street, with attention focused on the release of key US inflation data later in the day.
Traders are hoping that the consumer price index is showing a continued downward trend, which will give the Federal Reserve more room to cut interest rates.
But with policymakers warning that they wanted to see more positive indicators, there was some resignation on the exchange that a March rate cut was out of the question, and May said he was now expecting the first downturn in the economy. I’m leaning toward that view.
The CPI report is expected to fall below 3% year-on-year for the first time since March 2021, according to Bloomberg News.
Inflation expectations have fallen to the Fed’s 2% target this year, and expectations that the Fed will be able to ease monetary policy have been a major driver of market gains that have pushed the Dow and S&P 500 to multiple records this year. .
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But some observers said there could be an upside surprise as many companies raised prices to boost profits.
Furthermore, Stephen Innes of SPI Asset Management said: “The scary upside puts a damper on talk of easing inflation, with the probability of a May rate cut below 50%, encouraging stocks to seek further stimulus from a dovish Fed.” “It will reverse the market bull run,” he added.
“The U.S. is not out of the inflation problem yet, even if the market tries to pretend otherwise.”
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As much of the region returns to work after a long weekend in several countries, Tokyo led the gains thanks to a nearly 10% rise in SoftBank shares, further boosted by another blockbuster day for U.S.-listed company Arm. Ta.
Arm’s value has nearly doubled in the past week and tripled since it went public in September, thanks to healthy demand fueled by an expected artificial intelligence boom.
Prices also rose in Seoul, Sydney, Singapore and Manila.
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Hong Kong, Shanghai and Taipei remained closed for the Lunar New Year holiday.
The S&P 500 index fell slightly after hitting an all-time high on Friday, but Asian markets rose as the Dow Jones Industrial Average hit a new all-time high. The NASDAQ also fell slightly.
Tokyo – Nikkei Stock Average: up 2.4% to 37,798.89 (break)
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Hong Kong – Hang Seng Index: Closed due to public holiday
Shanghai – Combined: Closed due to public holiday
EUR/USD: down to $1.0764 from $1.0776 on Monday
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USD/JPY: Increased from 149.33 yen to 149.38 yen
GBP/USD: down from $1.2630 to $1.2616
EUR/GBP: up from 85.29p to 85.33p
West Texas Intermediate: up 0.1% to $77.01 per barrel
Brent crude: up 0.1% to $82.04 per barrel
New York – Dow: up 0.3% to 38,797.38 (close)
London – FTSE 100: flat 7,573.69 (closing price)
