Elaine Kurtenbach, The Associated Press
12 minutes ago
A photographer takes a picture of an electronic bulletin board showing the exchange rate between the Japanese yen and the US dollar at a securities company in Tokyo, Thursday, April 11, 2024. (AP Photo/Hoshiko Eugene)
BANGKOK (AP) – Stocks in Europe and Asia were mostly lower Thursday after U.S. stocks fell after another round of tougher-than-expected inflation data.
Germany’s DAX fell 0.4% to 18,022.81, while Paris’ CAC40 was unchanged at 8,046.18. In London, the FTSE 100 index fell 0.2% to 7,948.35.
Futures for the S&P 500 and Dow Jones Industrial Average fell 0.2%.
Even after the ruling Conservative Party suffered a crushing defeat in the parliamentary election, South Korean stocks have remained largely unchanged. The Kospi rose less than 0.1% to 2,706.96.
The result was a major political blow to President Yoon Seok-yeol, with all of Yoon’s chief of staff, except Prime Minister Han Deok-soo and security officials, submitting their resignations on Thursday.
China reported that consumer inflation rose slightly by 0.1% in March, while the price paid by manufacturers, the producer price index, fell 2.8% year-on-year. The data suggests deflationary pressures continue due to weak demand as property developers, banks and local governments struggle with high levels of debt.
Elsewhere in Asia, Tokyo’s Nikkei Stock Average fell 0.4% to $39,442.63, and Hong Kong’s Hang Seng Index fell 0.1% to $17,118.27.
The Shanghai Composite Index rose 0.2% to 3,032.01, while the S&P/ASX200 Index fell 0.4% to 7,813.60.
Bangkok’s SET fell 0.3%, while Taiwan’s Tyex fell 0.1%.
On Wednesday, the S&P 500 fell 0.9%. The Dow Jones Industrial Average fell 1.1%, and the Nasdaq Composite Stock Price Index fell 0.8%.
Inflation over the past three months has exceeded expectations.
That’s a pain for shoppers, as in-store prices could be even higher. For Wall Street, there are growing concerns that the Federal Reserve will hold off on delivering the interest rate cuts that traders are desperately hoping and betting on.
The Fed is waiting for further evidence that inflation is falling sustainably toward its 2% goal. Last year saw an encouraging cooling, but now there are concerns that inflation could stagnate after higher-than-expected inflation reports and broader economic indicators in January, February and March. There is.
Immediately after the morning inflation numbers were released, prices for everything from bonds to gold fell.
The yield on the 10-year U.S. Treasury rose to 4.54% from 4.36% late Tuesday, back to November levels. The two-year bond yield, driven largely by expectations of Fed action, rose further, rising from 4.74% to 4.97%.
Traders have sharply reduced their expectations that the Fed could start cutting interest rates in June. At the beginning of the year, it was predicted that more than six locations would be cut by 2024.
High interest rates slow the economy and reduce inflation by lowering investment prices. The fear is that if interest rates remain too high for too long, they could trigger a recession.
Wall Street’s biggest losers on Wednesday included real estate investment trusts, utility companies and other stocks most vulnerable to high interest rates.
In other trading early Thursday, benchmark U.S. crude oil fell 27 cents to $85.94 a barrel in electronic trading on the New York Mercantile Exchange.
Brent crude, the international standard crude, fell 22 cents to $90.26 per barrel.
The dollar fell to 153.15 yen from 153.17 yen, trading near a 34-year high. The yen depreciated because there was an expectation that the gap between Japan’s interest rates, which are close to zero, and the US interest rates would be large for the time being.
The euro fell to $1.0730 from $1.0746.
