Asian markets rise ahead of US inflation data

HONG KONG  -  Asian shares mostly rose on Thursday ahead of the release of crucial inflation data later in the day that will help chart the Fed’s rate cut timeline.

Investors are awaiting the release of the US Personal Consumption Expenditures (PCE) price index, the Federal Reserve’s most-watched in­flation indicator, which is ex­pected to influence the central bank’s policy decisions.

Expectations for cuts to US interest rates have shifted to later this year because recent inflation data has come in hot and Fed policymakers have taken a wait-and-see attitude, calling for more time and data showing that inflation is mov­ing towards their two percent goal. Analysts say the PCE fig­ures, and other US economic indicators coming Thursday, will likely influence market sentiment.

“The recent data is ‘noise’ and should be ignored outside of its impact for very short-term market movements,” Chris Zaccarelli, chief invest­ment officer for Independent Advisor Alliance, told Bloom­berg. “We are more interested in the PCE data,” he said. The world’s biggest economy will also report consumer and job­less figures.

“Given its status as a real-time gauge of the jobs mar­ket, the initial jobless claims release can sway investor perceptions and contribute to market volatility,” Stephen Innes, of SPI Asset Manage­ment, said in a note.

Wall Street’s main indices retreated on Wednesday, al­though losses on both the Dow and S&P 500 were modest.

“Stocks buoyed by A.I. eu­phoria encountered challeng­es in the final days of February as inflation concerns resur­faced, prompting investors to reckon with the prospect of higher interest rates likely to endure for an extended pe­riod,” Innes said.

“Indeed, investors have been in a state of cautious contemplation as they grap­ple with the shifting dynamics in interest rates, which have transformed from favourable trade winds to subtly chal­lenging headwinds.”

New York Fed boss John Wil­liams said Wednesday the cen­tral bank has “a ways to go” in its inflation fight, according to Bloomberg. Eurozone infla­tion figures are due Friday.

Cryptocurrency bitcoin topped $63,000 on Thursday thanks to feverish demand, edging in on its November 2021 peak.

Bitcoin has been buoyed by US moves towards creat­ing exchange-traded funds (ETFs) to track the price of the world’s most popular cryptocurrency, which would expand its potential investor pool by allowing the public to place bets without directly purchasing the digital unit.

Tokyo stocks closed lower, with the Japanese market lacking “clues for buying stocks after falls in US shares”, Matsui Securities said. Hong Kong and Shanghai were trad­ing higher, the latter up more than one percent.

Seoul, Wellington, Bangkok and Jakarta were lower, while Sydney, Taipei, Singapore, Manila and Kuala Lumpur were up.

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