Stock Markets Mixed Awaiting Key US Rate Decision

Stock markets diverged on Friday as investors awaited next week's crucial interest-rate decision from the US Federal Reserve

London (UrduPoint / Pakistan Point News - 9th Jun, 2023 ):Stock markets diverged on Friday as investors awaited next week's crucial interest-rate decision from the US Federal Reserve.

Wall Street rose in morning deals, with the S&P 500 extending gains a day after it entered a bull market as it was up more than 20 percent from its October low.

Expectations that the Federal Reserve will hold off raising interest rates on Wednesday for the first time since starting its hiking cycle last year to combat high inflation have pushed equities higher for most of the month.

"The question on everyone's mind is, will this good fortune for the stock market continue?" said Briefing.com analyst Patrick O'Hare.

"The answer is unknowable today since it rests in what the future brings the market in terms of economic data, earnings growth, interest rate movements, and policy action," he said.

Asian indices closed higher but Europe's major stock markets were down in afternoon deals, a day after data showed the eurozone was in recession at the start of the year.

Elsewhere, eyes are on China where there is growing speculation that authorities will unveil fresh stimulus measures to kickstart the world's number two economy, with the post-zero-Covid rally already fading.

Disappointing readings on manufacturing activity and trade this week have compounded the view that officials need to step in, with reports suggesting the People's Bank of China will cut interest rates soon.

Expectations were ramped up Thursday after a key government adviser said borrowing costs should come down to help struggling firms' financing ability.

The need for action was reinforced Friday by Chinese data showing consumer inflation essentially flat in May and wholesale prices falling more than expected.

"On the whole, the muted inflation environment may call into question the sustainability of the economic recovery, but it also provides a favourable backdrop for policymakers to roll out more policy support," said HSBC's Erin Xin.

In Turkey, newly re-elected President Recep Tayyip Erdogan appointed former Wall Street executive Hafize Gaye Erkan as central bank governor, raising market hopes she may reverse unconventional policies to fight the country's soaring inflation.

The Turkish currency sat around record lows of 23 lira per dollar.

- Key figures around 1340 GMT - New York - Dow: UP 0.1 percent at 33,865.23 points London - FTSE 100: DOWN 0.7 percent at 7,549.71 Frankfurt - DAX: DOWN 0.1 percent at 15,968.37 Paris - CAC 40: DOWN 0.2 percent at 7,209.24 EURO STOXX 50: DOWN 0.2 percent at 4,290.06 Tokyo - Nikkei 225: UP 2.0 percent at 32,265.17 (close) Hong Kong - Hang Seng Index: UP 0.5 percent at 19,389.95 (close) Shanghai - Composite: UP 0.5 percent at 3,231.41 (close) Euro/dollar: DOWN at $1.0771 from $1.0785 on Thursday Pound/dollar: UP at $1.2578 from $1.2560 Dollar/yen: DOWN at 139.49 yen from 138.89 yen Euro/pound: DOWN at 85.65 percent from 85.82 penceBrent North Sea crude: DOWN 0.4 percent at $75.69 per barrelWest Texas Intermediate: DOWN 0.6 percent at $70.90 per barrel