“There is growing confidence that the economy may not need a recession to tame the inflation monster,” SPI Asset Management’s Stephen Innes said in a report.
In early trade, the FTSE 100 in London was up 0.3% to 7,764.96. The DAX in Frankfurt rose 0.3% to 15,136.67 and the CAC 40 in Paris rose 0.7% to 7,092.34.
On Wall Street, futures for the benchmark S&P 500 index were up 0.4%. The Dow Jones Industrial Average rose 0.2%.
In Asia, Hong Kong’s Hang Seng rose 2.4% to 22,566.78. The Nikkei 225 in Tokyo lost 0.1% to 27,362.75.
The Kospi in Seoul gained 1.7% to 2,468.65 after South Korea’s economic output in the final quarter of 2022 shrank by 0.4% qoq as expected.
Manila’s main index slipped 0.3% after the Philippine economy grew 7.2% yoy in the final three months of 2022.
New Zealand, Singapore and Jakarta advanced while Bangkok and Kuala Lumpur declined.
On Wall Street, the S&P 500 index fell less than 0.1% on Wednesday after recovering from a 1.7% loss in the morning.
The Dow recovered from a similar decline to end below 0.1%. The Nasdaq Composite fell 0.2%.
Analysts are forecasting that S&P 500 companies will report their first drop in quarterly earnings per share since 2020 as the coronavirus pandemic begins.
Microsoft helped lead the way down after forecasting lower-than-expected earnings. It fell 4.6% early in the day but rallied to end down 0.6%.
Texas Instruments slipped 1.1% after the company said it expected weaker demand across its non-auto market as a whole. At times it had fallen by as much as 3.1%.
Traders expect the Fed to hike interest rates by another 0.25 percentage point in its next update on February 1st. That would be another reduction in margin for last month’s 0.5 percentage point increase and four 0.75 point increases earlier.
Many investors expect the Fed to ease its rate-hike plans as the economy slows and begin cutting rates before the end of this year. The Fed has said it will keep interest rates high at least until the end of the year to wipe out inflation.
In energy markets, the reference price for US crude rose 38 cents to $80.53 a barrel in electronic trading on the New York Mercantile Exchange. The contract rose 2 cents on Wednesday to $80.15. Brent crude, the price basis for international oil trading, rose 22 cents in London to $86.41 a barrel. In the previous session, it was down 1 cent to $86.12.
The dollar rose to 129.61 yen from 129.55 yen on Wednesday. The euro rose to $1.0918 from $1.0913.
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