A positive opening is on the cards as investors await the release of U.S. inflation data later in the day for clues as to how aggressively the Federal Reserve plans to raise interest rates.
The annual rate of consumer price growth is expected to slow to 8.1 percent in April from 8.5 percent in March. Data on producer prices, or wholesale prices that impact businesses, is also due.
Cleveland Fed President Loretta Mester told Bloomberg Television that she favors half-point interest-rate rises but doesn’t rule out 75-basis point move forever.
Her New York peer John Williams said that lowering inflation to more normal levels this year is the central bank’s main mission.
Fed Governor Christopher Waller said the U.S. economy is strong enough to front-load interest rate hikes.
Asian markets traded mixed, with Chinese and Hong Kong stocks rallying after China’s securities watchdog pledged a slew of measures to shore up confidence in the region’s worst-performing stock market.
The dollar hovered near two-decade highs and gold hit a three-month low, while oil prices were below the $100 mark amid uncertainty over Russian energy embargo by EU and worries about prolonged COVID lockdowns in Shanghai.
Consumer prices in China were up an annual 2.1 percent in April, the National Bureau of Statistics said earlier today. That exceeded expectations for an increase of 1.8 percent and was up from 1.5 percent in March.
Producer prices spiked 8.0 percent year-on-year, beating expectations for a gain of 7.7 percent but slowing from the 8.3 percent increase a month earlier.
U.S. stocks fluctuated before closing mixed overnight as Fed officials backed half-point hikes at the June and July meetings, adding the board would not rule out 75-bps hike.
The tech-heavy Nasdaq Composite climbed 1 percent and the S&P 500 edged up 0.3 percent amid bottom-fishing, while the Dow eased 0.3 percent.
European stocks rebounded on Tuesday as investors sought bargains at lower levels after four days of steep losses.
The pan-European STOXX 600 index advanced 0.7 percent after hitting a two-month low in the previous session.
The German DAX rallied 1.2 percent, France’s CAC 40 index rose half a percent and the U.K.’s FTSE 100 gained 0.4 percent.
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