Adulteration in Asian stocks ahead of Fed’s decision to hike rates
A man wearing a face mask stands in front of a bank’s electronic board showing the Hong Kong stock index in Hong Kong, Wednesday, June 15, 2022. Asian stock markets were mixed on Wednesday ahead of the Federal Reserve’s announcement on how quickly it would raise interest rates to calm US inflation. (AP photo/Qin Cheung)
A man wearing a face mask stands in front of a bank’s electronic board showing the Hong Kong stock index in Hong Kong, Wednesday, June 15, 2022. Asian stock markets were mixed on Wednesday ahead of the Federal Reserve’s announcement on how quickly it would raise interest rates to calm US inflation. (AP photo/Qin Cheung)
A man wearing a face mask stands in front of a bank’s electronic board showing the Hong Kong stock index in Hong Kong, Wednesday, June 15, 2022. Asian stock markets were mixed on Wednesday ahead of the Federal Reserve’s announcement on how quickly it would raise interest rates to calm US inflation. (AP photo/Qin Cheung)
A woman wearing a face mask shows the Hong Kong stock index in front of a bank’s electronic board in Hong Kong, Wednesday, June 15, 2022. Asian stock markets were mixed on Wednesday ahead of the Federal Reserve’s announcement on how quickly it would raise interest rates to calm US inflation. (AP photo/Qin Cheung)
BEIJING (AP) – Asian stock markets were mixed on Wednesday ahead of the Federal Reserve’s announcement of a sharp hike in interest rates to pacify US inflation.
Shanghai and Hong Kong advanced. Tokyo and Sydney declined. Oil prices rose.
Wall Street’s benchmark S&P 500 index fell 0.4% on Tuesday as traders wait for a Fed rate hike they expect to be three-quarters of a percentage point or triple the normal margin. He worries that the Fed’s aggressive action to calm inflation at a four-decade high could push the largest global economy into recession.
A “hawkish surprise” from the Fed could be “another blow to riskier assets,” said ActiveTrades’ Anderson Alves in a report. “Money markets are already valued at about a 90% chance of such action.” Determining.”
The Shanghai Composite Index rose 1.1% to 3,323.64 after the Chinese government reported factory output reverted to positive territory in May as anti-virus controls that closed businesses in Shanghai and other industrial hubs were eased.
Hong Kong’s Hang Seng was up 1.2% at 21,312.67 while the Nikkei 225 in Tokyo was down 0.7% at 26,435.01.
The Kospi in Seoul fell 1.2% to 2,463.45 after the government cut South Korea’s unemployment rate from 0.1% to 2.8% in May.
Sydney’s S&P-ASX 200 was down 0.4% at 6,658.40. New Zealand and Singapore advanced while Jakarta declined.
On Wall Street, the S&P 500 fell to 3,735.48, which puts it down 21.8% from its January 3 peak. This places it in a bear market, or a 20% drop from the top of the previous market.
The Dow Jones Industrial Average fell 0.5% to 30,364.83, and the Nasdaq Composite rose 0.2% to 10,828.35.
After government data on Friday raised hopes of an unusually large hike in the Fed rate, consumer inflation accelerated in May instead of easing as expected.
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The Fed has been scrambling to get prices under control after previously being criticized for reacting slowly to inflationary pressures.
Britain’s central bank has also raised rates and the European Central Bank says it will do so next month.
Japan’s central bank has kept rates near record lows. This has caused the yen to fall to a two-decade low near $135 as traders move capital in search of higher returns.
Markets have also been hit by Russia’s attack on Ukraine, which has pushed oil prices to all-time highs above $120 a barrel, and the virus outbreak in China caused factory closures and disrupted supply chains. happened.
In energy markets, benchmark US crude rose 13 cents to $119.06 a barrel in electronic trading on the New York Mercantile Exchange. The contract lost $2 on Tuesday to $118.93. Brent crude, the price base for international oil trade, rose 14 cents to $121.31 a barrel in London. It fell $1.10 to $121.17 in the previous session.
The dollar fell from Tuesday’s 135.30 yen to 135.13 yen. The euro rose from $1.0411 to $1.0446.
7 Commodity ETFs to Help Hedge Against Inflation
Commodity is a broad category that includes agricultural products such as wheat, corn and soybeans. It also includes oil and derivative products such as gasoline, natural gas and diesel fuel.
However, investing in commodities includes precious metals such as gold and silver as well as base metals such as copper and aluminum. And more recently, this area includes commodities like lithium that will be needed in many emerging sectors of our economy.
Commodity trading is often done by trading contracts on the futures market. And it’s not for the faint-hearted investors. Prices are volatile and can change quickly due to macroeconomic events.
However, at certain times, especially in times of high inflation, commodities outperform the broader market. A practical option for individual investors looking to profit from commodities is to invest in exchange-traded funds (ETFs). These funds allow investors to invest in this sector by reducing the risk of investing in a single commodity.
Here are seven ETFs you can buy to help hedge against inflation.
See “7 Commodity ETFs to Help Hedge Against Inflation.”
