HONG KONG — Global stock markets exhibited a varied performance on Wednesday as investors reacted to Wall Street’s predominantly favorable results, all while anticipating crucial U.S. inflation figures that may impact potential rate cuts by the Federal Reserve.
In Europe, Germany’s DAX experienced a modest increase of 0.2%, reaching 20,311.39, whereas the CAC 40 in Paris remained unchanged at 7,424.49. London’s FTSE also saw a gain, rising by 0.8% to hit 8,263.60.
Futures for the S&P 500 and the Dow Jones Industrial Average indicated a slight increase of 0.1%. Conversely, Japan’s Nikkei 225 index slipped by 0.1% to settle at 38,444.58.
The South Korean market saw little change as the Kospi closed at 2,496.81. This came on the day when law enforcement detained the impeached President Yoon Suk Yeol concerning his unsuccessful attempt to declare martial law the previous month. South Korea’s unemployment rate climbed to 3.7% in December—its highest since June 2021—due to ongoing political instability, according to government reports.
In Hong Kong, the Hang Seng index increased by 0.3% to 19,286.07 after reports surfaced that the economic team of President-elect Donald Trump is considering a phased increase in tariffs. Meanwhile, the Shanghai Composite dipped by 0.4% to 3,227.12.
Shares related to Xiaohongshu, a popular app in China similar to Instagram, surged after it achieved the top position on the Apple App Store in the U.S. This spike is linked to TikTok users adjusting to the potential threat of a ban on the platform. Shares for firms like Foshan Yowant Technology and Inly Media Co. both appreciated by approximately 10%.
In Australia, the S&P/ASX 200 experienced a slight decline of 0.2%, finishing at 8,213.30.
On the previous day, the S&P 500 posted a modest rise of 0.1% to conclude at 5,842.91, with about three-quarters of the stocks in the index gaining ground. The Dow Jones Industrial Average climbed by 0.5% to reach 42,518.28, while the Nasdaq composite faced a small drop of 0.2%, closing at 19,044.39.
Market optimism was fueled by a report indicating that inflation at the wholesale level in the U.S. was lower than anticipated last month. This development is viewed positively ahead of a later report expected to detail inflation levels experienced by consumers at gas stations, grocery stores, and car dealerships in December.
While inflation figures remain stubbornly high, a series of unexpected strong updates concerning the U.S. economy have contributed to a slowdown in Wall Street’s rally, pulling it away from the numerous record highs achieved last year. Concerns linger that this positive data may lead the Federal Reserve to provide less monetary relief by not lowering interest rates as frequently as hoped.
The Fed has signaled it may only cut rates twice in 2025, down from an earlier forecast of four reductions. Speculation regarding the potential of no rate cuts this year is also on the rise.
Throughout the day, stock indexes fluctuated between gains and losses, largely due to declines among several major technology companies. Nvidia’s stock dropped by 1.1%, making it the second-largest contributor to the S&P 500’s losses.
The stock that weighed the most on the market was Eli Lilly, which saw a notable decline of 6.6% as the company projected weaker revenue for the last quarter of 2024 than previously estimated. CEO David Ricks indicated that last quarter’s 45% growth in revenue from Lilly’s Mounjaro diabetes treatment and Zepbound obesity injections fell short of expectations.
In other developments on Wednesday, U.S. benchmark crude oil prices increased by 29 cents, reaching $76.66 per barrel, while Brent crude, the global standard, rose by 42 cents to $80.34 per barrel. The U.S. dollar depreciated against the Japanese yen, falling from 158.00 yen to 157.08 yen, while the euro slightly decreased from $1.0309 to $1.0299.
