The wider S&P 500 dropped 4.35 points to 2,173.80, while the tech-focused Nasdaq index was 12.63 points lower at 5,214.48. The S&P 500 lost 9.16 points, or 0.42 per cent, to 2,168.99, Xinhua news agency reported.
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China’s CSI 300 index and the Shanghai Composite has both seen 0.6 percent losses after authorities confirmed the launching of a long-awaited scheme in order to allow stock trading between Shenzhen and Hong Kong, and raised quota limits for the existing Shanghai-Hong Kong Stock Connect.
“The CPI initially drove the gold price higher but then NY Federal Reserve President (William) Dudley hinted that interest rate hikes could come as early as this September”, said Miguel Perez-Santalla, vice president of Heraeus Metal Management in New York.
USA stocks are slipping Tuesday afternoon as investors continue to sell phone company and utility stocks.
San Francisco Fed President John Williams said on Monday afternoon that the USA central bank should consider setting a higher inflation target.
The pan-European STOXX 600 was up 0.36 percent.
But the argument that the Fed should at least raise rates once this year is likely to hold sway, he said.
The dollar index was up 0.3 percent at 95.025 after losing 0.8 percent on Tuesday, when it touched a 7-week trough of 94.426.
Investors expect more insight on the rate outlook at an annual meeting of central bankers from around the world in Jackson Hole, Wyoming, next week. MSCI’s emerging market index was last down 0.93%. Core inflation, which leaves out food and fuel prices, inched up just 0.1 percent for the month. Crude oil futures initially rose after U.S. Energy Information Administration weekly figures showed a larger-than-expected draw in inventories and added to gains following the Fed minutes.
Having struck near 31-year lows earlier in the week, sterling traded nearly unchanged at $1.3028 following a 1.3 percent rise overnight due to slightly higher than expected United Kingdom inflation data.
“The dollar is getting support from Dudley’s general reference to the market being too complacent about Fed hikes between now and end-2017″, said Gareth Berry, a foreign-exchange and rates strategist in Singapore at Macquarie Bank Ltd”. Brent crude, used to price worldwide oils, also dropped 25 cents, to $48.98 in London. Also, September hike possibility moved higher to 22 percent probability, up from 16 percent last week.
U.S. industrial production increased 0.7 per cent in July, better than expectations of 0.3 per cent, after moving up 0.4 per cent in June, said the Federal Reserve on Tuesday.
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The greenback has slumped more than 5 percent this year as Fed policy makers have yet to see signs that inflation is moving toward their 2 percent goal.
