Asian shares track Wall Street gains on cooling inflation

Aug 9, 2022, 11:02 PM | Updated: Aug 10, 2022, 11:25 pm

BANGKOK (AP) — Shares advanced Thursday in Asia after benchmarks closed at three-month highs on Wall Street as investors cheered a report showing inflation cooled more than expected in July.

Hong Kong, Shanghai and Seoul saw gains of more than 1%. Tokyo was closed for a holiday. U.S. futures edged higher, while oil prices slipped.

The government said Wednesday that consumer inflation jumped 8.5% in July from a year earlier. But that was down from June’s four-decade high of 9.1%.

The S&P 500 surged 2.1% on expectations that slower inflation will mean the Federal Reserve may moderate its interest rates hikes. Technology stocks, cryptocurrencies and other investments that have been among the year’s biggest losers due to the Fed’s aggressive rate hikes led the way.

Hong Kong’s Hang Seng index added 1.9% to 19,982.20 while the Shanghai Composite index gained 1.2%, to 3,268.02. The Kospi in Seoul rose 1.3% to 2,513.22 and Taiwan’s Taiex was up 1.5%.

In Thailand, the SET picked up 0.4% after the country’s central bank raised its benchmark interest rate by 0.25 percentage points to 0.75% a day earlier. The Southeast Asian country’s economy has been hard hit by the pandemic, which ravaged its all-important tourism sector.

On Wall Street, the S&P 500 rose 87.77 points to 4,210.24, hitting its highest levels since early May. It is now nearly 15% above its mid-June low.

The Nasdaq composite, whose many high-growth and expensive-looking stocks have been particularly vulnerable to interest rates, jumped 2.9% to 12,854.80. It’s up more than 20% from June.

The Dow Jones Industrial Average rose 1.6% to 33,309.51.

Technology stocks, cryptocurrencies and other of the year’s hardest-hit investments were some of the day’s biggest winners. Bitcoin rose 2.2% to just under $24,000.

Lower prices for gasoline and oil helped tempered inflation in July. But excluding that and volatile food prices, so-called “core inflation” held steady last month, at 5.9%, instead of accelerating as economists had forecast.

The data encouraged traders to scale back bets for how much the Fed will raise interest rates at its next meeting. Interest rates help set where prices go across financial markets and higher rates tend to pull down prices for everything from stocks to commodities to crypto.

Other reports this week will show how inflation is doing at the wholesale level and whether U.S. households are still ratcheting down their expectations for coming inflation, an influential data point for Fed officials.

Prices for bonds soared immediately after the inflation report’s release, pulling their yields lower. The yield on the two-year Treasury, which tends to track expectations for the Fed, fell to 3.19% from 3.27% late Tuesday.

The 10-year yield initially fell, though stabilized later in trading. It edged higher to 2.79% from 2.78% late Tuesday. It remains below the two-year yield and many investors see such a gap as a fairly reliable signal of a coming recession.

Recession worries have built as the highest inflation in 40 years squeezes households and corporations around the world. Wall Street is closely watching to see if the Fed can succeed in hitting the brakes on the economy and cooling inflation without veering into a recession.

The Federal Reserve will get a few more highly anticipated reports before its next announcement on interest rates, on Sept. 21. They could also alter its stance. Those include data on hiring trends across the economy, due Sept. 2, and the next update on consumer inflation, coming on Sept. 13.

In other trading, U.S. benchmark crude oil shed 15 cents to $91.78 per barrel in electronic trading on the New York Mercantile Exchange. It gained $1.43 to $91.93 on Wednesday.

Brent crude, the basis for international pricing, lost 10 cents to $97.30.

The U.S. dollar rose to 133.20 Japanese yen from 132.93 yen late Wednesday. The euro slipped to $1.0288 from $1.0300.

___

AP Business Writers Stan Choe and Damian J. Troise contributed.

Copyright © The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

AP

(AP Photo/Charlie Neibergall)...

Associated Press

Donald Trump stored, showed off and refused to return classified documents, indictment says

An indictment charging former President Donald Trump with mishandling classified documents has been unsealed.

2 days ago

FILE - A bottle of Jack Daniel's Tennessee Whiskey is displayed next to a Bad Spaniels dog toy in A...

Associated Press

Ruff day in court: Supreme Court sides with Jack Daniel’s in dispute with makers of dog toy

The Supreme Court on Thursday gave whiskey maker Jack Daniel's reason to raise a glass, handing the company a new chance to win a trademark dispute with the makers of the Bad Spaniels dog toy.

3 days ago

(Pixabay Photo)...

Associated Press

6 arrested in alleged scheme to fraudulently collect millions in COVID aid meant for renters

Six people from Washington, Arizona and Texas have been arrested and accused of fraudulently obtaining millions of dollars of COVID-19 aid from an assistance program meant for renters, federal prosecutors said.

3 days ago

FILE - Protesters stand outside of the Senate chamber at the Indiana Statehouse on Feb. 22, 2023, i...

Associated Press

LGBTQ+ Americans are under attack, Human Rights Campaign declares in state of emergency warning

The Human Rights Campaign declared a state of emergency for LGBTQ+ people in the U.S. on Tuesday.

5 days ago

FILE - People wait in line outside the Supreme Court in Washington to listen to oral arguments in a...

Associated Press

Supreme Court opened the door to states’ voting restrictions. Now a new ruling could widen them.

Within hours of a U.S. Supreme Court decision dismantling a key provision of the Voting Rights Act, Texas lawmakers announced plans to implement a strict voter ID law that had been blocked by a federal court. Lawmakers in Alabama said they would press forward with a similar law that had been on hold.

5 days ago

Gavel (Pexels Photo)...

Associated Press

Ex-teacher sentenced to prison for making death threat against Arizona legislator

A former Tucson middle school teacher was sentenced Tuesday to 2 ½ years in prison after pleading guilty to making a death threat against Arizona state Sen. Wendy Rogers.

5 days ago

Sponsored Articles

...

DAY & NIGHT AIR CONDITIONING, HEATING AND PLUMBING

Here are the biggest tips to keep your AC bill low this summer

PHOENIX — In Arizona during the summer, having a working air conditioning unit is not just a pleasure, but a necessity. No one wants to walk from their sweltering car just to continue to be hot in their home. As the triple digits hit around the Valley and are here to stay, your AC bill […]

...

re:vitalize

Why drug-free weight loss still matters

Wanting to lose weight is a common goal for many people as they progress throughout life, but choosing between a holistic approach or to take medicine can be a tough decision.

...

OCD & Anxiety Treatment Center

How to identify the symptoms of 3 common anxiety disorders

Living with an anxiety disorder can be debilitating and cause significant stress for those who suffer from the condition.

Asian shares track Wall Street gains on cooling inflation