GLOBAL MARKETS DJIA 32654.59 431.17 1.34% Nasdaq 11984.52 321.73 2.76% S&P 500 4088.85 80.84 2.02% FTSE 100 7518.35 53.55 0.72% Nikkei Stock 26839.65 179.90 0.67% Hang Seng 20492.51 -110.01 -0.53% Kospi 2623.46 3.02 0.12% SGX Nifty* 16243.50 -25.5 -0.16% *May contract USD/JPY 129.20-21 -0.12% Range 129.54 129.10 EUR/USD 1.0534-37 -0.16% Range 1.0565 1.0534 CBOT Wheat July $12.774 per bushel Spot Gold $1,815.90/oz 0.1% Nymex Crude (NY) $111.88 -$2.32 US STOCKS
U.S. stock indexes climbed as investors snapped up beaten-down shares in the technology, banking, airline and other sectors.
The S&P 500 rose about 2%, while the Dow Jones Industrial Average added around 1.3%. The tech-heavy Nasdaq Composite jumped about 2.8%.
Stocks have taken a beating in recent weeks on wide-ranging economic, geopolitical and Covid-19 concerns. Weighing most heavily on many investors' minds is the outlook for the U.S. economy as the Federal Reserve lifts interest rates to combat inflation.
Fresh data from the Commerce Department showed some signs of economic resilience, with U.S. shoppers increasing retail spending in April for the fourth consecutive month. That, as well as the reopening of some stores in Shanghai this week after a strict Covid-19 lockdown, provided some sources of optimism.
Stocks briefly pared gains in the afternoon as Fed Chairman Jerome Powell voiced resolve in fighting inflation, before indexes climbed back toward new session highs. "There could be some pain involved" in restoring price stability, Mr. Powell said in remarks at The Wall Street Journal's Future of Everything Festival.
ASIAN STOCKS
Japan's Nikkei Stock Average rose 1.2% to 26969.75, led by gains in electronics and tech stocks, following a U.S. tech stock rally overnight that was partly driven by signs of U.S. economic resilience. Investors are focusing on movements in the yen and crude-oil prices, and updates on Covid-19 lockdowns in China.
South Korea's Kospi rose 0.9% to 2644.00 in early trade, tracking Wall Street's gains overnight. The rally in U.S. semiconductor stocks is helping boost local memory-chip stocks, Kiwoom Securities said. USD/KRW was 0.6% lower at 1,267.50 on renewed risk appetite. Foreign and retail investors were net buyers of local equities.
Hong Kong's Hang Seng Index fell 0.5% to 20505.52 amid mild losses in U.S. stock futures that undermine risk appetite. However, declines may be limited by Chinese Vice-Premier Liu He's support for development of the tech sector and public listings for technology companies, analysts said. His comments may drive some hopes that regulatory risks for these companies could be letting up, said IG market strategist Yeap Jun Rong in an email. The Hang Seng TECH Index was 1.2% lower at 4218.68.
Chinese stocks were mixed in early trade after opening higher, amid concerns over recent weak April economic data and the impact of the country's zero-Covid policy on its economy. The Shanghai Composite Index was 0.4% lower at 3081.37, the Shenzhen Composite Index fell 0.1% to 1937.37 and the ChiNext Price Index was flat at 2369.36.
FOREX
Most Asian currencies weakened against USD amid emerging risk aversion driven by losses in some regional equity markets and U.S. stock futures. It is still far too early to call a long-term peak in USD and retracements should be shallow, said Westpac analysts in a research report. Fed Chair Powell reinforced the Fed's resolutely hawkish stance overnight, although the ECB is beginning to coalesce around a more hawkish posture, they added. USD/KRW rose 0.3% to 1,270.15 and USD/SGD edged 0.1% higher to 1.3864, while AUD/USD was down 0.2% at 0.7013.
METALS
Gold edged higher in early Asia trading despite contrary influences in the market. Interest-rate differentials between the U.S. and some countries have narrowed, which has put downward pressure on USD and given the "green light" for gold investors to buy the dip, said Oanda senior market analyst, Edward Moya, in an email. However, gold has pared recent gains partly because U.S. retail sales data suggest the consumer remains strong, which is spurring expectations that the Fed won't ease up on its policy tightening, the analyst said. Spot gold was recently up 0.1% at $1,815.90/oz.
OIL SUMMARY
Oil prices were higher in early Asian trade on optimism over China demand after Shanghai had a third straight day of no new Covid-19 infections outside quarantine zones on Tuesday. The "less awful news on China offers a nip in the tail in the form of much higher oil demand and prices," said SPI Asset Management managing partner Stephen Innes in an email. However, the lack of an EU ban on Russian oil could limit the topside until the special summit on May 30-31, which is the next opportunity to agree on such an embargo, Innes added. Front-month WTI crude oil futures were 1.6% higher at $114.22/bbl; front-month Brent crude oil futures gained 1.2% to $113.27/bbl.
While the near-term outlook for oil prices is strong, Macquarie's research analysts expect prices to fade in 2H. Brent crude has averaged $107/bbl in 2Q so far but a likely increase in oil supply from OPEC and other countries, potentially including Iran, should weigh on prices in 2H, Macquarie said. "We maintain our long-term assumption of $65/bbl but defer this to 1Q of 2024 [from 1Q of 2023]," Macquarie added.
TOP HEADLINES Powell Says Fed Has Resolve to Bring U.S. Inflation Down Japan's Economy Shrinks Slightly in First Quarter Tech Shares Rebound, Leading Stock Rally Fed's Evans: Inflation Is Much Too High and Fed Must Act U.S. Floats Tariff on Russian Oil as EU Oil-Sanction Talks Drag On Spain, Australia, U.K. Most Exposed to Financial Shock as Rates Rise, Says Fitch China's New-Home Prices Continued to Fall in April Soft Australian First-Quarter Wage Growth Casts Doubt Over Pace of Rate Hikes Even the Foreign-Exchange Market Is Getting Kind of Crazy U.S. Economy Is Headed for a Downturn, Wells Fargo CEO Says U.S. Retail Sales Grew 0.9% in April House Plans Vote on Baby Formula Legislation Wednesday Prosecutors Seek Transcripts from Jan. 6 Committee JPMorgan Shareholders Reject Jamie Dimon's $50 Million Bonus Apple Pauses Plans to Go From Two Days to Three Days a Week in the Office Netflix Cuts About 150 Staffers in Another Round of Layoffs U.S. Allows Chevron to Maintain Venezuela Operations but Won't Permit Drilling Steve Wynn Sued by Justice Department Mother Sues TikTok After Alleging 10-Year-Old Daughter Died From Doing 'Blackout Challenge' Fortescue Founder Forrest to Retake Control of Iron-Ore Operations Walmart Earnings Are Dented by Food Inflation, Staffing Costs Allianz Subsidiary Pleads Guilty to Defrauding Investors as Part of $6 Billion Settlement
(END) Dow Jones Newswires
05-17-22 2315ET
