By ELAINE KURTENBACH – AP Business Writer
BANGKOK (AP) – Shares were mostly lower in Europe and Asia on Monday after Wall Street recorded its worst week since the pandemic began in 2020.
Shares fell in Paris, London and Frankfurt, but rose in Tokyo. Shanghai was a little changed.
Investors have become more and more concerned about how aggressively the Federal Reserve, which is holding a political meeting this week, can act to cool rising inflation.
Historically low interest rates, called quantitative easing or QE, have helped support the broader market as the economy absorbed a sharp hit from the pandemic in 2020 and then recovered over the past two years.
“The FOMC (Fed) meeting dominates the macro calendar this week and is likely to keep risk sentiment on the hesitant side with an end to QE and impending rate hikes that are likely to be announced,” said economists Nicholas Mapa and Robert Carnell of ING. comment.
Germany’s DAX fell 1.1% to 15,431.03, while the CAC 40 in Paris gave up 1.4% to 6,971.19. In London, the FTSE 100 fell 0.7% to 7,447.03. Futures for the S&P 500 and Dow industrials rose 0.3%.
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Some economists believe the Fed and other central banks need to move faster to curb rising prices by raising interest rates. U.S. consumer prices rose 7% in December compared to a year earlier, the largest increase in nearly four decades.
Rising costs raise concerns that consumers will start easing consumption due to the persistent pressure on their wallets. At the same time, outbreaks of the omicron variant of coronavirus threaten to slow the recovery from the crisis.
Tokyo’s Nikkei 225 index rose 0.2% to 27,588.37.
The shares in the electronics and energy giant Toshiba Corp. fell 1.6% after the company said it was halting production at a plant in southern Japan that makes semiconductors for vehicles and machinery, after a powerful earthquake hit the region.
Hang Seng in Hong Kong fell 1.2% to 24,656.46. In Australia, the S & P / ASX 200 lost 0.5% to 7,139.50, and India’s Sensex fell 2.7% to 57,419.98.
South Korea’s Kospi fell 1.5% to 2,792.00 due to large sales of major technology companies such as Samsung and LG Chemical. Thailand’s SET lost 0.7 pct.
The Shanghai Composite Index rose less than 0.1% to 3,524.11.
On Friday, the benchmark S&P 500 fell 1.9% to 4,397.94, down 5.7% for the week in its worst weekly loss since March 2020.
The technology-heavy Nasdaq composite index fell 2.7% to 13,768.92. It has been falling for four weeks in a row and is now more than 10% below its most recent high, putting it in what Wall Street considers a market correction.
The Dow Jones Industrial Average fell 1.3% to 34,265.37.
With investors expecting the Fed to start raising interest rates as soon as its March political meeting, expensive stocks in technology companies and other expensive growth stocks now look relatively less attractive.
Treasury interest rates have fallen as investors turn to safer investments. The yield on the 10-year government bond fell to 1.73% from 1.76% on Friday.
The Fed’s leading short-term interest rate is currently in the range of 0% to 0.25%. Investors now see a nearly 70% chance of the Fed raising interest rates by at least one percentage point by the end of the year, according to CME Group’s Fed Watch tool.
In other trading, US benchmark crude rose 21 cents to $ 85.35 per share. barrel of electronic trading on the New York Mercantile Exchange. It dropped 41 cents on Friday to $ 85.14 per barrel.
Brent crude, the basis for international oil pricing, added 26 cents to $ 88.15 per barrel. barrel.
The US dollar fell to 113.62 Japanese yen from 113.68 yen. The euro fell to $ 1.1327 from $ 1.1346.
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