BEIJING (AP) — Asian stock markets followed Wall Street higher on Friday ahead of a speech by the Federal Reserve chair that investors hoped would shed light on plans for more interest rate hikes.
Shanghai, Tokyo, Hong Kong and Seoul advanced. Oil prices rose.
Investors focused on Chair Jerome Powell’s speech at the Fed’s annual Jackson Hole meeting for signs of when the U.S. central bank might raise rates again and by how much to cool inflation that is running at multi-decade highs.
Traders worry the Fed’s four rate hikes this year, plus increases by central banks in Europe and Asia, might derail global growth. Some expect the Fed to reverse course and start cutting rates in 2023 due to signs the U.S. economy might be cooling.
“The Fed could start thinking about a pause in rate hikes, potentially for the end of the year,” said Thomas Costerg of Pictet in a report. “However, it is still too early to talk about rate cuts.”
The Shanghai Composite Index
SHCOMP,
The Kospi
180721,
New Zealand and Southeast Asian markets also rose.
Global markets have swung between optimism about stronger corporate profits and unease about possible recession risks.
On Wall Street, the S&P 500
SPX,
The Dow Jones Industrial Average
DJIA,
All three indexes reduced their losses for the week after a tumble Monday that was their in months.
Also Thursday, the government reported the U.S. economy didn’t contract by as much as previously thought during the spring. It shrank 0.6% on an annualized basis, the government said, less than the previous 0.9% estimate.
The Fed’s Jackson Hole meeting in Wyoming, which attracts economists from around the world, has been the setting for market-defining announcements in the past.
Investors are hoping for clarity from Powell after Fed officials said they still supported rate hikes despite hopes inflation might be peaking.
In energy markets, benchmark U.S. crude
CL.1,
The dollar
DXY,
