Yahoo Finance Wall Street mixed while FTSE bounces back to close higher amid market jitters
The FTSE 100 (^FTSE) managed to lift off in the last hours of trading, despite recession fears renewed by the surprise move by the Bank of Japan to move away from the country's ultra loose monetary policy.
The FTSE 100 was flat most of the day but closed higher, gaining 0.27% to 7,381, while the CAC (^FCHI) in Paris slipped 0.18% to 6,461 points. In Germany, the DAX (^GDAXI) retreated 0.31% to 13,899.
On Wall Street, the Dow Jones (^DJI) was flat at 32,770. The S&P 500 (^GSPC) retreated 0.15 % to 3,811 points and the tech-heavy Nasdaq (^IXIC) was down 0.37% at 10,506.
Susannah Streeter, senior investment and markets analyst at Hargreaves Lansdown pointed out there were "a sackful of concerns about the prospects for global growth are still being lugged around by investors and are weighing down sentiment on financial markets."
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Miners and energy stocks suffered losses, tracking falling oil and copper prices as surging COVID infections in top-consumer China raised concerns over near-term demand outlook.
Meanwhile, Brent crude (BZ=F) is hovering around $80/barrel as the US revealed a plan to restock its Strategic Petroleum Reserve.
Shares in Asia have tumbled after an unexpected move by the Bank of Japan signalled the beginning of the end for the country’s ultra loose monetary policy.
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The bank kept its benchmark interest rate unchanged but increased the upper limit of its tolerance band on 10-year government bonds to 0.5% from 0.25%.
Tokyo’s Nikkei 225 (^N225) fell 2.46% to finish at 26,568 while the Hang Seng (^HSI) in Hong Kong lost1.41% to 19,079. The Shanghai Composite (000001.SS) retreated 1.07% to 3,073 points.
“The BOJ's role as an ultra-dovish outlier among global central banks had been a key driver of JPY weakness in 2022, and markets are now assessing whether today’s announcement is effectively a first step towards a broader policy normalisation process in Japan, which would quite radically change the outlook for the yen in 2023,” ING FX strategist Francesco Pesole said.
“BoJ’s surprise move allowed it to take a small step away from the extreme dovish side of the monetary policy spectrum, where it had stood alone all year among major central banks,” wrote Jennifer Lee of BMO Economics in a note to clients. “It is not joining the rate-hikers out there, but it is now a tad closer.”
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