- Asian shares are falling as worries about inflation set off expectations the U.S. Federal Reserve might accelerate its plans to raise interest rates
- The Dow Jones Industrial Average rose 0.5% to 35,813.80, while the Nasdaq composite closed 0.5% lower, at 15,775.14.
- Best Buy slumped 12.3%, the biggest drop in the S&P 500, as concerns about tighter margins outweighed solid earnings.
- In energy trading, benchmark U.S. crude rose 5 cents to $78.55 a barrel.
Concerns over inflation sparked a sell-off in Asian stocks on Wednesday, fueling speculation that the US Federal Reserve may hike interest rates as reported by ABC News.
Following a national holiday on Tuesday, Japan’s Nikkei 225 index fell 1.1% to 29,436.73 in early trading.
The Kospi index in South Korea fell 0.3% to 2,988.40.
The S&P/ASX 200 index in Australia fell about 0.1% to 7,403.30.
“Markets continue to adjust their expectations toward a tighter Fed monetary policy,” said IG market strategist Yeap Jun Rong, who added that investors will be monitoring for U.S. data later in the day.
To combat inflation, some Asian central banks have already begun to hike interest rates.
The Federal Reserve will issue minutes from its October policy meeting later in the day, perhaps providing investors with additional information on the central bank’s plan to begin reducing bond purchases that have kept interest rates low.
Gains in banks and energy companies cushioned losses elsewhere in the market as Wall Street ended a shaky day of trading.
After fluctuating between tiny gains and losses for much of the day, the S& P 500 managed to climb 0.2% to 4,690.70.
The Dow Jones Industrial Average increased by 0.5 0.5% to 35,813.80, while the Nasdaq Composite Index fell by 0.5% to 15,775.14.
To 2,327.86, the Russell 2000 index lost 0.1%.
In the S& P 500, more than 60% of the stocks climbed.
Gains in banks, energy stocks, and consumer goods companies were offset by losses in technology and communication sectors, as well as a mix of consumer-facing businesses.
Before the official start of the holiday shopping season, retailers were split.
Concerns about reduced margins overcame solid profits, as Best Buy fell 12.3%, the most in the S& P 500.
The 10-year Treasury yield increased to 1.68% late Monday from 1.63%, then dipped to 1.65% by midday Wednesday in Asia.
The decision was taken in coordination with other major oil-consuming countries, notably Japan.
Although Japan’s overall data does not show a problem with inflation of the same magnitude as other countries, critics argue that it is just not as obvious in sectors hit hard by rising energy prices, such as industries that rely on fuel to plastic bags made from petroleum.
Benchmark U.S. crude increased 5 cents to $78.55 a barrel in energy trade.
With U.S. markets closing on Thursday for Thanksgiving and then closing early on Friday, stocks are expected to see more uneven activity this week.
The Labor Department’s weekly report on unemployment benefits will be released.
The euro was $1.1236, down from $1.1249 the day before.
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Source: ABC News