Global markets have reacted positively after minutes of the US Federal Reserve’s latest meeting showed policymakers were in no rush to raise interest rates.
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Federal Open Market Committee (FOMC) officials were divided last month on the Federal Reserve’s interest rate increase decision, minutes from the group’s meeting showed Wednesday, APA reports quoting Anadolu Agency. Japan’s benchmark fell after July trade declined.
The stocks were chiefly responsible for the 0.62 percent decline in the S&P 500’s consumer discretionary index.
Dow e-minis 1YMc1 were down 17 points, or 0.09 percent at 8:25 a.m. ET (1225 GMT), with 13,144 contracts changing hands.
Taken during the July 26-27 meeting, the minutes detailed policy makers’ differing views of the U.S. economic outlook as they made a decision to leave a key interest rate untouched at 0.25-0.5 per cent. The move pushed oil prices lower by almost 1 percent. Meanwhile the Dow Jones industrial average fell 45.57 points, or 0.25 per cent, to 18,506.45, the S&P 500 lost 5.18 points, or 0.24 percent, to 2,172.97 and the Nasdaq Composite dropped 16.26 points, or 0.31 per cent, to 5,210.86.
“Until we have clarity around the U.S. rate hike, gold is going to remain range bound between US$1,320 and US$1,370”, said Hamza Kahn, ING Bank’s senior strategist. But policymakers believing a slowdown in the future pace of hiring would argue against a near-term hike outnumbered those who anticipated economic conditions would soon warrant tightening.
However, the committee “recognized that progress on the inflation front has been very slow, and a number of members prefer to see clearer evidence that inflation is moving closer to the 2 percent inflation objective before raising rates again”. The rise in the yen has made imports cheaper but Japanese goods more expensive for foreign customers, hurting the economy.
Home improvement retailer Kingfisher (KGFHY) was down 0.06% in early trading. That company and Target both lowered profit forecasts. Barnes & Noble tumbled after the book seller said CEO Ronald Boire is leaving after less than a year in the job.
ENERGY: Benchmark U.S. crude added 19 cents to $46.98 per barrel in electronic trading on the New York Mercantile Exchange.
Brent crude prices rose to their highest since July 4 as the world’s biggest producers prepared to discuss a possible freeze in production levels. It jumped 62 cents the previous session.
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The dollar fell as low as 99.65 yen from 100.28 yen Wednesday in NY, before creeping back above the 100 yen level in afternoon trading.
