Stock Market Today: Asian Stocks Rise After Another Round of Wall Street Records - Latest Global News

Stock Market Today: Asian Stocks Rise After Another Round of Wall Street Records

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Asian stocks were mostly higher on Thursday after U.S. stocks rose to record levels on hopes that inflation was heading in the right direction.

The optimism came from a report that showed U.S. consumers paid prices for gasoline, car insurance and everything else in April that were a total of 3.4% higher than a year earlier, less than the inflation rate of 3.5% in March.

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The slowdown was a relief after consumer price index (CPI) reports were consistently worse than expected earlier this year. Wednesday’s report was based on expectations that the Federal Reserve could cut its key interest rate this year, which is the biggest concern for most investors.

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In Asian trading, the Nikkei 225 index in Tokyo rose 1.4% to 38,920.26, even after the government reported that Japan’s economy shrank at an annual rate of 2% in the January-March quarter.

Hong Kong’s Hang Seng index rose 1.5% to 19,355.77. The Shanghai Composite Index fell 0.1% to 3,118.40.

In Australia, the S&P/ASX 200 rose 1.7% to 7,881.30, while South Korea’s Kospi rose 0.8% to 2,753.00.

Taiwan’s Taiex gained 0.7% and India’s Sensex gained 0.2%.

On Wednesday, the S&P 500 rose 1.2%, surpassing its peak reached a month and a half ago, to close at 5,308.15. The Dow Jones Industrial Average gained 0.9% to 39,908.00 and the Nasdaq rose 1.4% to 16,742.39, underpinning its own record set the previous day.

Stocks that tend to benefit most from lower interest rates contributed to market leadership. Homebuilders rose on hopes that Fed rate cuts could lead to lower mortgage rates, with Lennar, DR Horton and PulteGroup all rising more than 5%. Big tech companies and other high-growth stocks were also hit by the wave of expectations for lower interest rates, and Nvidia’s 3.6% gain was the biggest force pushing the S&P 500 higher.

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Real estate stocks in the S&P 500 rose 1.7%, while shares of electric companies and other utilities rose 1.4%. The dividends they pay look better for investors when bonds pay less interest.

On Wall Street, Petco Health + Wellness contributed to market leadership with a 27.9% increase. It named Glenn Murphy, CEO of investment firm FIS Holdings, as executive chairman.

On the losing side were GameStop and AMC Entertainment as momentum reversed after their stunning start to the week. GameStop fell 18.9%, although it is still up 126.5% so far this week.

AMC Entertainment fell 20% after it said it would issue nearly 23.3 million shares of its stock to pay down $163.9 million in debt.

A separate report on Wednesday showed spending at U.S. retailers did not increase in April compared to March. Economists had expected growth of 0.4%.

A decline in retail sales could be seen as positive for markets as it could reduce upward pressure on inflation. But weaker U.S. consumer spending would undermine one of the main pillars keeping the economy out of recession. Low-income households in particular are coming under increasing pressure.

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In the bond market, the 10-year Treasury yield fell to 4.34% from 4.45% late Tuesday. The two-year yield, which is more closely aligned with expectations of Fed action, fell to 4.72% from 4.82%.

Traders now forecast a nearly 95% chance that the Fed will cut interest rates at least once this year, according to data from CME Group. That’s up from just under 90% the day before.

In other trading early Thursday, U.S. benchmark crude oil rose 32 cents to $78.92 a barrel in electronic trading on the New York Mercantile Exchange. On Wednesday it rose 61 cents.

Brent crude, the international standard, rose 30 cents to $83.05 a barrel.

The US dollar fell to 154.21 Japanese yen from 154.88 yen. The euro rose from $1.0885 to $1.0879.

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