Stock market today: Asian shares mostly higher after US inflation data ease rate hike worries

Shares were mostly higher in Asia on Thursday after a highly anticipated report showed inflation accelerated across the US in August, but not by much more than expected.US futures rose and oil prices also were higher.The subdued increase in US prices eased worries over the likelihood of another interest rate hike by the Federal Reserve, leading Tokyos Nikkei 225 to surge 1.4 per cent to 33,168.10.

Shares were mostly higher in Asia on Thursday after a highly anticipated report showed inflation accelerated across the US in August, but not by much more than expected.

US futures rose and oil prices also were higher.

The subdued increase in US prices eased worries over the likelihood of another interest rate hike by the Federal Reserve, leading Tokyo’s Nikkei 225 to surge 1.4 per cent to 33,168.10. In Seoul, the Kospi jumped 1.1 per cent, to 2,561.45.

Hong Kong’s Hang Seng index slipped 0.1 per cent to 17,995.21 on renewed concern over China’s property sector. Major real estate developer Country Garden’s Hong Kong-traded shares sank 4.6 per cent ahead of a deadline for a bond repayment.

The Shanghai Composite index declined 0.3 per cent to 3,114.38, while in Australia, the S and P / ASX 200 advanced 0.6 per cent to 7,195.10.

On Wednesday, the S and P 500 edged up 0.1 per cent to 4,467.44 after flipping between small gains and losses. The Dow Jones Industrial Average dropped 0.2 per cent to 34,575.53, and the Nasdaq composite rose 0.3 per cent, to 13,813.59.

The inflation report said US consumers paid prices last month that were 3.7 per cent higher than a year earlier, up from July’s inflation rate of 3.2 per cent and slightly more than the forecasts for a 3.6 per cent increase.

That’s discouraging for shoppers paying higher prices, but much of the acceleration was because of higher fuel costs. Underlying inflation trends indicated a continued moderation in price increases, economists said. Inflation has been generally cooling since peaking above 9 per cent last year.

The inflation report was so highly anticipated because it will help steer what the Federal Reserve does next on interest rates. The Fed has already hiked its main rate to the highest level in more than two decades, which hurts prices for stocks and other investments, and the hope on Wall Street is that inflation has cooled enough for it to be done.

Even though economists are willing to ignore fuel costs when looking at inflation to find the underlying trends, households and companies don’t get the same luxury.

Stocks of airlines were some of the biggest losers in the S and P 500 after a couple warned of the hit to profits they’re taking because of higher costs.

American Airlines cut its forecast for profits during the summer because fuel costs are running higher than it expected. It also had to pay about USD 230 million in retroactive pay to pilots after they ratified a new labour contract. Its stock fell 5.7 per cent.

Spirit Airlines said it’s also paying higher fuel costs this summer than expected, roughly USD 3.06 per gallon instead of the USD 2.80 it had earlier forecast. It’s also been seeing steep discounting to fares during the last few weeks. That pushed it to cut its forecast for revenue during the third quarter, and its stock fell 6.3 per cent.

Other airlines also sank, including declines of 3.8 per cent for United Airlines and 2.8 per cent for Delta Air Lines.

On the winning end of Wall Street were high-growth stocks that could benefit if the Fed stops hiking interest rates. High rates hurt all kinds of investments, but they often most hurt technology companies and others promising big future growth.

Amazon climbed 2.6 per cent, Microsoft gained 1.3 per cent, and Nvidia rose 1.4 per cent.

Moderna rallied 3.2 per cent after it reported encouraging results from a flu vaccine trial.

In other trading Thursday, US benchmark crude oil added 56 cents to USD 89.07 per barrel in electronic trading on the New York Mercantile Exchange. It lost 32 cents on Wednesday.

Brent crude, the pricing standard for international trading, was up 53 cents at USD 92.41 per barrel.

The US dollar slipped to 147.14 Japanese Yen from 147.47 Yen. The Euro rose to USD 1.0745 from USD 1.0732.

(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)