Stock markets cautious ahead of key Fed speech
MANILA, Philippines - Stock markets were mostly lower Friday as investors awaited a speech by U.S. Federal Reserve Chairwoman Janet Yellen later in the day for cues on the timing of the next interest rate hike.
Britain’s FTSE 100 was up 0.1 percent at 6,823 while Germany’s DAX was 0.2 percent lower at 10,505. France’s CAC 40 edged down 0.1 percent to 4,403.
U.S. futures indicated a muted opening on Wall Street, with the Dow and S&P futures roughly flat.
Yellen’s speech “is the big event that the markets anticipated, and it has the potential to create waves within the calmness that has prevailed throughout this month,” said Margaret Yang, market analyst at CMC Markets Singapore. She said that aside from less risk-taking ahead of the speech at the Jackson Hole meeting, momentum and trading volumes are slowing in the equities market, with sentiment more fragile in the backdrop of slumping commodities, weak demand and overcapacity in emerging economies.
Japan’s Nikkei 225 fell 1.2 percent to 16,360.71 after core consumer prices posted their biggest annual drop in three years in July due to weak consumption. Hong Kong’s Hang Seng index rose 0.4 percent to 22,908.54. China’s Shanghai Composite rose 0.1 percent to 3,070.31. Australia’s S&P ASX 200 slid 0.5 percent to 5,515.50, while South Korea’s KOSPI fell 0.3 percent to 2,037.50.
Japan’s core consumer price index, which includes all items except fresh food, dropped 0.5 percent in July from a year earlier, according to data released Friday by Japan’s Statistics Bureau. It was the biggest decline since March 2013 and adds pressure on the central bank to further expand an already massive economic stimulus program. Overall inflation was down 0.4 percent from a year earlier.
Benchmark U.S. crude oil shed 16 cents to $47.17 a barrel from $47.33. Brent crude, used to price oil internationally, slipped 27 cents to $49.40 a barrel.
The dollar fell to 100.45 yen from 100.58 yen the previous day. The euro rose to $1.1293 from $1.1285.