Stock Market Today: World stocks are higher on optimism pricing pressure could ease WSB-TV Channel 2

TOKYO — (AP) World stocks rose Monday as investors took heart from reports showing inflation is easing, which could allow the Federal Reserve to back out of interest rate hikes.

US futures were mixed and oil prices rose slightly.

The German DAX added 0.3% to 16,187.06. In Paris, the CAC 40 rose 0.1% to 7,406.82 and the UK FTSE 100 rose 0.3% to 7,553.25.

Futures for the Dow Jones Industrial Average fell 0.1%, while those for the S&P 500 rose 0.1%. On Friday, the S&P 500 climbed 1.2% to 4,450.38, its highest level since April 2022. The Dow Jones Industrial Average was up 0.8% and the Nasdaq composite was up 1.4%.

Trading in the US is closed for half a day on Monday and all day on Tuesday for Independence Day.

Investors are hoping that the price hikes will slow down enough for the Federal Reserve to halt rate hikes soon. That would mean less pressure on the US economy and global financial markets.

This was revealed in a report on Friday an inflation measure the Fed prefers to use was eased in May. It also said consumer spending growth slowed more than expected. Fewer dollars chasing purchases could remove more pressure on inflation.

Inflation in Europe fell again in June, with an annual rate of 5.5% 6.1% in May in the 20 countries that use the euro, the European Union statistics agency Eurostat reported.

That’s an improvement, but not enough offer much relief to shoppers grumble about price tags or to stop more interest rate hikes that will raise the cost of borrowing across the economy.

Also in Asia, central banks have started to maintain stable or lower interest rates to counter the slowing economic activity. Vietnam and China have cut tariffs, while in other countries manufacturing activity is slowing down as demand for exports declines.

In Asian trading, the Japanese benchmark Nikkei 225 was up 1.7% to 33,753.33 in afternoon trading. Australia’s S&P/ASX 200 added 0.6% to 7,246.10. South Korea’s Kospi rose 1.5% to 2,602.47. The Hong Kong Hang Seng rose 2.1% to 19,306.59, while the Shanghai Composite gained 1.3% to 3,243.98.

The quarterly tankan report on business sentiment, prepared by the Bank of Japan, showed an improvement from June last year for the fifth consecutive quarter, with the key indicator rising 3 points to plus 23.

The Federal Reserve has already raised interest rates by a massive 5 percentage points from near zero at the beginning of last year. Traders on Wall Street have reversed bets that the Fed will raise rates twice this year, with the majority betting that the federal funds rate will be just 0.25 percentage points higher by the end of 2023, according to data from CME Group.

Bond market yields fell Friday after the release of economic data. The yield on 10-year government bonds fell from nearly 3.87% just before the reports were released to 3.82%. It helps set rates for mortgages and other important loans.

The S&P 500 closed its sixth winning week of its last seven in June and its best month since October. The index’s gains of nearly 16% in the first six months of the year are better than in 16 of the last 23 full years.

In energy trading, US crude rose 57 cents to $71.21 a barrel in electronic trading on the New York Mercantile Exchange. Brent crude, the international standard, rose 59 cents to $76.00 a barrel.

In currency trading, the US dollar rose from 144.30 yen to 144.73 Japanese yen. The euro was priced at $1.0890, down from $1.0924.

___

Yuri Kageyama is on Twitter https://twitter.com/yurikageyama

Copyright 2023 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed without permission.