Wall Street’s main indexes rose today as investors shrugged off a surge in consumer prices that raised concerns of early policy tightening by the Fed.
The Dow Jones Industrial Average was up 0.6 per cent, while the S&P 500 advanced 0.4 per cent at the open. Meanwhile, the tech-heavy Nasdaq gained 0.2 per cent.
Wall Street’s indexes have moved tepidly this week with most investors sticking to the sidelines ahead of inflation data and an upcoming Fed meeting.
The Labor Department said its consumer prices index increased 0.6 per cent last month after surging 0.8 per cent in April.
“The numbers were slightly more than expected, but not way outside of the range,” said Mark Grant, chief global strategist at B. Riley Financial.
“I don’t think this is going to change the Fed’s view of keeping rates very low.”
London’s FTSE 100 creeped higher this afternoon as a string of upbeat earnings gently nudged investors ahead of key US inflation data.
The blue-chip index was up 0.3 per cent, as pharmaceutical and insurance stocks buoyed the market.
Meanwhile, the mid-cap FTSE 250 dipped by 0.4 per cent after hovering near record highs earlier in the week.
“There’s a sense of every man for himself ahead of the US inflation data this evening, which has left markets in limbo,” said Jeffrey Halley, market analyst at OANDA.
The afternoon’s biggest winner was Auto Trader, who soared 5.7 per cent, followed by BT, up by 5.4 per cent.
Hikma Pharmaceuticals and GlaxoSmithKline also rose 1.9 per cent and 1.6 per cent respectively.
JD Sports was the afternoon’s biggest faller, dropping by 3.5 per cent, followed by Next’s 2.8 per cent hit.
Meanwhile, Compass Group and digital supermarket Ocado both dipped by 2.5 per cent and 1.8 per cent respectively.
Around the world
Asian shares edged higher today but held their recent tight trading range as investors focused on US inflation data and the risk of the Fed tapering its massive stimulus.
MSCI’s broadest index of Asia-Pacific shares outside Japan advanced to 703.7 points, while Japan’s Nikkei rose 0.3 per cent.
Chinese shares shot up 0.6 per cent, while Australia’s benchmark index finished 0.6 per cent higher.
“A significant upside surprise in inflation could tilt the Fed taper discussion to sooner rather than later, though the majority would still be looking for substantial progress toward maximum employment before considering tapering,” ANZ economists wrote in a note.
So far though, “the market is buying into the Fed’s view that the rise in prices is transitory, and the Fed will not alter its policy guidance at next week’s FOMC meeting,” they added.