The gist of the minutes of the Federal Open Market Committee (FOMC) meeting which confirmed another 2 interest rate hikes of 0.5% in the coming month has left the stock market slightly positive.
It is understood that the unanimous decision of Federal Reserve (Fed) policymakers in coordinating inflation containment measures without triggering a recession has cheered investors.
As a result, the MSCI worldwide stock index reached 0.70% and the pan-European STOXX 600 index rose 0.63%.
The MSCI Asia-Pacific index outside Japan closed higher at 0.25% while Japan’s Nikkei lost 0.26%.
On Wall Street, the Dow Jones Industrial average added 191.66 points or 0.6% at 32,120.28 while the S&P 500 hit 37.25 points or 0.95% at 3,978.73 and the Nasdaq Composite rose 170.29 points or 1.51% at 11,434.74.
According to ANZ chief economist Sharon Zollner, the minutes hinted that a large hike would provide flexibility in the long run.
Meanwhile, DataTreck Research founder Nicholas Colas explains that the Fed uses stock prices as a tool to fight inflation, so it indirectly explains the changes that have taken place in recent weeks.
He argued that low share prices signal to companies to stop hiring and impact wage inflation, in addition to restoring wealth that will reduce consumer spending.
On the other hand, the Reserve bank of New Zealand reportedly raised interest rates by half a point on Wednesday and warned a bigger hike would be made.
The currency summary saw the dollar index rise 0.393% after 2 sessions of losses against a number of other major currencies while the Euro declined 0.56% at $ 1.0674.
Treasury Notes 10 -year yield declined 1.5 basis points at 2.745% while 2 -year Treasury yield declined 1.5 basis points at 2.506%.
For commodities, spot gold was down 0.6% at $ 1,853.91 an ounce.
