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Global stock markets mostly rise after Fed decision
NEW YORK, Sept 28, 2018 (BSS/AFP) – Most of the world’s stock markets
pushed higher and the dollar rose Thursday as investors embraced the Fed’s
view that the US economy is growing solidly but not at imminent risk of
overheating.
An exception was Milan, which faltered on worries about its fiscal
profile, and Tesla Motors, which dived in after-hours trading on news US
securities regulators have charged chief executive Elon Musk for fraud
connected to an aborted effort to take the electric car private.
The US central bank on Wednesday hiked interest rates for the third time
this year, as expected, citing an increasingly strong economy and jobs
market, with Fed governor Jerome Powell saying he saw no vulnerabilities in
the financial system.
While Wall Street stocks ended the day down on Wednesday, the market
gained on Thursday, with the broad-based S&P 500 climbing 0.3 percent.
European markets also rose solidly.
Powell “was calm and talked about how confident they are that inflation
will remain contained,” said Chris Low of FTN Financial.
“The general takeaway was that the Fed is very comfortable and there is no
need to overreact on interest rates.”
The rise in the dollar helped perk up European stocks as the slide in the
value of the euro and pound helps exporters.
The odd man out was Milan’s FTSE MIB index, which tumbled 0.6 percent on
anxiety over the Italian government’s release of its budget.
Late Thursday, hours after the Milan market closed, Italy’s populist
government agreed on a deficit target of 2.4 percent of gross domestic
product in 2019, a number high enough to likely spark conflict with Brussels.
– Tesla falls –
US tech shares had a good day, with Apple rising following a bullish
analyst report from JPMorgan Chase, and Amazon winning 1.9 percent as it
opened a new retail store in New York for products that get top ratings from
customers. The move is the online giant’s latest push into brick-and-mortar
selling.
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Other large tech companies, including Facebook and Google-parent Alphabet
won more than one percent.
But Tesla Motors sank 10.9 percent in after-hours trading as the US
Securities and Exchange Commission charged Musk with securities fraud,
alleging he misled investors last month in tweets about taking the company
private.
The SEC said Musk’s statements on Twitter that he had “funding secured” to
go private at $420 a share were “false and misleading” and that he had never
discussed the plans with company officials or potential funders.
Shares in German industrial conglomerate Thyssenkrupp shot up 17 percent
after its board decided to split the historic group into two listed
companies.
Shareholders have demanded splitting up the massive conglomerate, whose
businesses range from building elevators, submarines and car parts to
steelmaking. Such a reorganisation could help unlock value for investors.
– Key figures around 2100 GMT –
New York – Dow Jones: UP 0.2 percent at 26,439.93 (close)
New York – S&P 500: UP 0.3 percent at 2,914.00 (close)
New York – Nasdaq: UP 0.4 percent at 8,041.97 (close)
London – FTSE 100: UP 0.5 percent at 7,545.44 (close)
Frankfurt – DAX 30: UP 0.4 percent at 12,435.59 (close)
Paris – CAC 40: UP 0.5 percent at 5,540.41 (close)
Milan – FTSE MIB: DOWN 0.6 percent at 21,511 (close)
EURO STOXX 50: UP 0.5 percent at 3,449.79 (close)
Tokyo – Nikkei 225: DOWN 1.0 percent at 23,796.74 (close)
Hong Kong – Hang Seng: DOWN 0.4 percent at 27,715.67 (close)
Shanghai – Composite: DOWN 0.5 percent at 2,791.77 (close)
Euro/dollar: DOWN at $1.1641 from $1.1739 at 2100 GMT
Pound/dollar: DOWN at $1.3078 from $1.3167
Dollar/yen: UP at 113.39 yen from 112.73 yen
Oil – Brent Crude: UP 38 cents at $81.72 per barrel
Oil – West Texas Intermediate: UP 55 cents at $72.12 per barrel
BSS/AFP/HR/0940