Share prices rose in Europe on Wednesday after a sharp fall in Asia, which has upset a broad slide on Wall Street over rising prices and rising yields on U.S. government bonds.
The rapid rise in Treasury yields is forcing investors to re-evaluate whether prices for stocks have been too high, especially for the most popular ones. On Tuesday, yields in the 10-year Treasury jumped to 1.54 percent, its highest level since the end of June. Which rose to 1.32 percent from a week ago.
Early Wednesday, it fell again to 1.50 percent.
“What we’ve got here is the stock market which ultimately looks risky as Treasury yields rise, oil prices look like they could easily exceed $ 90 a barrel, and supply chain problems show no signs of easing,” said Onder Edward Moya. “
Germany’s DAX rose 0.7 percent to 15,358.67 and the Paris CAC 40 also rose 0.7 percent to 6,551.59. Britain’s FTSE 100 rose 0.7 percent to 7,079.21.
U.S. futures have also improved, with the Dow Industrial contract up 0.5 percent, while the S&P 500 futures are up 0.6 percent.
In Asian trading, Tokyo’s Nikkei 225 fell 2.1 percent to 29,544.29 and Seoul’s Kospi fell 1.2 percent to 3,060.27. The Shanghai Composite Index fell 1.8 percent to 3,536.29. In Sydney, the S&P / ASX 200 rose 1.1 percent to 7,196.70.
Hong Kong’s Hang Seng index rose 0.7 percent to 24,663.50 after reversing previous losses, after troubled asset developer Evergrand Group said it was selling a stake in Shenzhen Bank for 9.9 billion yuan (1.5 1.5 billion) – a solution to its cash crunch. A step towards.
Hong Kong-traded shares of Evergrand jumped 15 percent.
In Japan, former Foreign Minister Fumio Kishidar was elected party chief by the ruling Liberal Democrats, and his decision to become the next prime minister comes after the market closed.
Kishida, 64, is seen as an organization figure, although he has called for action to tackle growing inequality in Japan, the world’s third-largest economy.
On Tuesday, the benchmark S&P 500 index fell 2 percent, its worst fall since May, and tech-heavy Nasdaq fell 2.8 percent, its worst fall since March. The number of pioneers on the New York Stock Exchange has dropped from 4 to 1.
The Dow Jones Industrial Average fell 1.6 percent and the Russell 2000 index fell 2.2 percent.
The benchmark S&P 500 has fallen 3.8 percent so far this month and is on track for its first monthly loss since January after a gain of about 16 percent since early 2021.
Bond yields began to rise after the Federal Reserve sent a clear signal last week that the central bank was moving closer to starting to withdraw the unprecedented support it had given to the economy during the crisis. The Fed has indicated that it may start raising its benchmark interest rates sometime next year and will likely begin to slow down its monthly bond purchases before the end of this year.
Yield increases mean Treasuries are paying higher interest rates, and it encourages investors to pay less for stocks and other things that are riskier bets than U.S. secured bonds. The recent rise in rates has made technology stocks particularly difficult because their prices seem to be more expensive than in other parts of the market, compared to how much they are gaining.
Companies are warning that supply chain problems and high prices could hurt sales and profits. The Federal Reserve has maintained that rising inflation has temporarily recovered from the economic epidemic and disrupted supply chains.
In other trade, the U.S. benchmark crude oil traded up 58 cents at .7 74.71 a barrel on the New York Mercantile Exchange. It fell 16 cents to 75 75.29 a barrel on Tuesday.
International price Brent crude oil fell 60 cents to 77 77.75 a barrel.
The US dollar fell from 111.48 yen to 111.30 Japanese yen. The euro fell from 16 1.1683 to 16 1.1663.
Written by Ellen Curtenbach
This News Originally From – The Epoch Times