Hong Kong: Bargain hunting helped most Asian markets recover some of the losses from this week’s sharp decline. Investors tracked Wall Street’s gains and cheered up from unexpected jobless claims reports, although inflation concerns continue to be seen in the transaction. Shade the floor.
Global equities have been convulsed for months by expectations that a blockbuster global recovery will send prices rocketing, forcing central banks — particularly the Federal Reserve — to taper the ultra-loose monetary policies that have helped drive a rally for more than a year.
Although senior central bank officials have promised that due to the low base last year, these increases are temporary, and that such increases will not be shaken until unemployment is controlled and inflation continues to rise, but investors have been thinking about what they consider inevitable. Things to prepare.
In this way, they can sell companies with high interest rate risk (such as the technology industry) and buy companies that benefit (such as the financial industry).
The scorching inflation narrative was reinforced this week with US consumer prices coming in far above estimates on Wednesday, followed by data Thursday showing the wholesale price index at its highest since comparable records began in 2010.
“This bigger-than-expected rise does suggest that we will probably get another two or three months of high inflation prints,” said CMC Markets analyst Michael Hewson. He added that would also present the Fed with “a problem, with so many people starting to get nervous that base effects may not be able to explain all of the upward pressure on prices”.
Eyes are now on the release of retail sales later in the day.
Analysts said that after a few days of selling, investors are still preparing to jump into this ranks, thanks to the release of a report that showed that the number of new jobless in the world’s top economies was lower than expected and dropped to The lowest level since the pandemic. begin.
The Dow Jones Industrial Average and the Standard & Poor’s 500 Index both rose more than 1%, and the high-tech Nasdaq Index also performed well. The yield on the benchmark 10-year U.S. Treasury bond (a key indicator of future inflation) has also fallen.