Asian markets higher ahead of Fed rate decision

BEIJING (AP) — Asian stock markets rose for the most part on Monday ahead of what is expected this week to be a decision by the Federal Reserve to raise interest rates again amid investors’ hopes that the U.S. central bank plans for more hikes. will scale back.

Tokyo, Hong Kong and Seoul advanced, while Shanghai fell. Oil prices fell. The euro remained below $1.

Wall Street ended higher last week after Apple and other major companies reported strong gains and a closely watched inflation measure accelerated in September.

The Fed is widely expected to announce another rate hike of 0.75 percentage point, three times its usual margin, at this week’s meeting. Investors are looking for signs that officials are satisfied that past hikes imposed to cool inflation, which has been high for nearly four decades, are working and that future hikes could be smaller.

Investors fear that rate hikes by the Fed and other central banks to cool inflation could push the global economy into recession. The US central bank raised its benchmark lending rate from 3% to 3.25% from almost zero in March.

“The tone of Fed Chair Jerome Powell will be important” after this week’s meeting, IG’s Yeap Jun Rong said in a report. Investors are looking for “increased concerns about economic conditions” rather than the “current determination to tame inflation”.

The Nikkei 225 in Tokyo gained 1.6% to 27,529.33 as the government reported retail sales rose in September, though industrial production weakened.

The Shanghai Composite Index lost 0.2% to 2,909.48 after a manufacturing survey showed weakening production and demand. The Hang Seng in Hong Kong rose 0.7% to 14,970.21 points.

The Kospi in Seoul rose 0.9% to 2,289.00 and the S&P-ASX 200 in Sydney rose 0.8% to 6,836.80. New Zealand and Southeast Asian markets also gained.

On Wall Street, the benchmark S&P 500 index rose 2.5% to 3,901.06 on Friday after US government data showed consumer prices rose 6.2% from a year earlier in September, the same as the price of the US dollar. the previous month.

Core inflation, which removes volatile food and energy prices to show the underlying trend, accelerated to 5.1% from 4.9% in August. Powell and other Fed officials have said they are ready to keep interest rates high until they are confident inflation has died down.

The Dow Jones Industrial Average rose 2.6% to 32,861.80. The Nasdaq composite climbed 2.9% to 11,102.45.

Apple Inc. rose 7.6% after reporting a higher-than-expected quarterly profit. Intel Corp. rose 10.7% after earning higher-than-expected earnings, but said it saw “deteriorating economic conditions”. Gilead Sciences Inc. rose 12.9% and T-Mobile US Inc. won 7.4% after they also beat the earnings forecasts. Inc. lost 6.8% after the company provided a weaker-than-expected revenue forecast.

Earlier in the weakness, Facebook operator Meta Platforms Inc. almost a quarter of its stock market value after a second consecutive quarter of turnover decline. TikTok. Microsoft Corp. and Google’s parent company, Alphabet Inc., also reported delays in key areas.

Also on Friday, government data showed that wage increases for American workers were in line with expectations. Powell has cited wages as a measure that the Fed will watch as it decides to raise interest rates.

The yield on the two-year Treasury, which usually follows Fed action expectations, rose to 4.42% from 4.28% at the end of Thursday from 4.28% at the end of Thursday. The 10-year interest rate, which helps determine the rates for mortgages and many other loans, rose from 3.93% to 4.01%.

In the energy markets, the US benchmark crude oil lost 33 cents to $87.57 a barrel in electronic trading on the New York Mercantile Exchange. The contract fell $1.18 to $87.90 on Friday. Brent crude, used to price international oils, fell 52 cents to $93.25 a barrel in London. It fell $1.19 to $95.77 on Friday.

The dollar rose to 148.06 yen from 147.53 yen on Friday. The euro fell from 99.55 cents to 99.53 cents.

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