Asian markets muted after Fed suggests it’s ready to act on inflation

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BEIJING: Asian stock markets fell on Thursday, with Federal Reserve officials indicating they are ready to raise interest rates as soon as needed to quell inflation.

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Shanghai Composite Index SCOMP,
-0.10%
fell 0.1% while the Nikkei 225 NIK,
+0.77%
Tokyo gained 0.8%. Hang Seng Hsi,
+0.12%
Hong Kong gained 0.1%.

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Kospi 180721,
-0.37%
0.4% in Seoul and S&P/ASX 200 XJO in Sydney,
+0.13%
Advanced 0.1%. Shares fall in Singapore STI,
-0.14%
BUT GET IN INDONESIA JAKIDX,
+0.55%,
While Taiwan Y9999,
+0.14%
and Malaysia FBMKLCI,
-0.09%
Was about flat.

Wall Street markets are closed on Thursday for the Thanksgiving holiday. They reopened for a short trading session on Friday.

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Fed officials said at their October policy meeting that they would “not hesitate” to respond to inflation, according to notes released on Wednesday. He foresaw the possibility of raising rates “sooner than participants currently anticipated”.

This has led investors to fear that the Fed and other central banks may feel pressured to roll back the economic stimulus that is driving up stock prices. Fed officials have previously indicated they may raise rates at the end of next year.

Mizuho Bank’s Tan Boon Heung said in a report that higher prices as well as strong US hiring suggest the attitude could be “of course more aggressive” at the next Fed meeting.

On Wall Street, S&P 500 SPX,
+0.23%
increased to 4,701.46. Gains in technology, real estate and energy stocks outweighed a slide in banks and materials companies.

Dow Jones Industrial Average DJIA,
-0.03%
Slipped less than 0.1% to 35,804.38. Nasdaq Composite Comp,
+0.44%
rose 0.4% to 15,845.23.

Fed notes show that officials still believe this year’s inflation is likely to be temporary, but acknowledged prices rose more than expected.

The notes covered the October meeting at which Fed board members voted to take the first steps to roll back easier credit and other measures to support the economic recovery from the coronavirus pandemic.

Benchmark US crude CLF22 in energy markets,
-0.04%
It rose 10 cents to $78.49 a barrel in electronic trading on the New York Mercantile Exchange. Brent Crude BRNF22,
+0.09%,
The international oil price rose 14 cents to $81.19 a barrel in London.

Dollar USDJPY,
-0.06%
fell from 115.48 yen to 115.37 yen.

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