World Shares Up Even As Inflation Worries Dog Wall Street

Shares were mostly higher in Europe and Asia on Monday, Feb. 20, 2023, after Wall Street closed out another bumpy week marked by uneasiness over the outlook for inflation and interest rates.

Photo Insert: Recent data have revived worries that inflation in the US is not cooling as quickly as hoped.

Germany’s DAX gained 0.1% in early trading to 15,494.14 and the CAC 40 in Paris also was 0.1% higher, at 7,354.01. Britain’s FTSE 100 climbed 0.2% to 8,016.05. The futures for the S&P 500 and the Dow Jones Industrial Average were 0.1% lower.

US markets will be closed for a holiday Monday, Elaine Kurtenbach reported for the Associated Press (AP).

China left its benchmark lending rate, the loan prime rate, unchanged as expected. The 1-year rate was kept at 3.65% while the 5-year rate is 4.3%. In Asian trading, Hong Kong’s Hang Seng index gained 0.8% to 20,886.96 while the Shanghai Composite index jumped 2.1% to 3,290.34.

Tokyo’s Nikkei 225 edged up 0.1% to 27,531.94. India’s Sensex slipped 0.5% to 60,702.28. South Korea’s Kospi added 0.2% to 2,455.12 and Australia’s S&P/ASX 200 was up 0.1% at 7,351.50. Shares in Southeast Asian markets declined, apart from in Bangkok, where the SET gained 0.4%.

Recent data have revived worries that inflation in the US is not cooling as quickly as hoped. That has shaken hopes the Federal Reserve might take it easier on interest rate hikes and avoid tipping the economy into recession.

That has added to turbulence on Wall Street after the year started off with solid gains.

“There was not a lot of major news, but in the back of every traders’ mind was the thought that this whole ‘high inflation/Fed hiking’ scenario, may not actually be over as soon as many hoped,” Clifford Bennett, chief economist at ACY Securities, said in a commentary. “The troubles may be far from over.”

On Friday, the S&P fell 0.3% and the Dow industrials rose 0.4%. The Nasdaq composite fell 0.6%. This week, an updated estimate Thursday of U.S. economic growth in October-December will provide more insight into how businesses and consumers are faring.

The forecasts are that growth will have slowed to 2.8% or 2.9% from the previous quarter, down from 3.2%. In other trading Monday, US benchmark crude oil gained 74 cents to $77.29 per barrel in electronic trading on the New York Mercantile Exchange. It sank $2.19 on Friday to $76.55 per barrel.

Brent crude oil, the pricing basis for international trading, picked up 84 cents to $83.84 per barrel. The US dollar slipped to 134.27 Japanese yen from 134.28 yen. The euro rose to $1.0690 from $1.0681.

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