Chinese Business

Stock markets fell on Friday after strong US jobs data raised concerns that the US Federal Reserve may continue to aggressively hike interest rates to tame inflation. 

Oil prices, meanwhile, were slightly up as investors awaited an output decision by OPEC and its Russia-led allies and tracked Western plans to cap Russian crude prices.

Stock markets are focused on the next moves of the US central bank.

While Fed chief Jerome Powell signalled on Wednesday that the central bank could start “moderating” the pace of rate hikes as soon as December, investors were unnerved by Friday’s jobs figures.

US government data showed that the world’s biggest economy added 263,000 jobs in November, with the unemployment rate remaining at 3.7 percent.

Strong job gains raise concerns among investors, as a healthy economy could convince the Fed it still has room to deliver more sharp rate increases to fight inflation.

“The report itself is good news from an economic standpoint, yet the market sees it as bad news, thinking it will push out any eventual pivot by the Fed with its monetary policy,” said Briefing.com analyst Patrick O’Hare.

Wall Street opened lower while Paris and London were down in afternoon trading and Asia finished in the red. Frankfurt was flat.

– OPEC+ –

The focus was also on OPEC+, which may decide Sunday to slash oil production further to boost prices for its members, which include Saudi Arabia and Russia.

“There remains considerable uncertainty around the action OPEC+ will take when it meets…, although there’s every chance that the meeting will be delayed or that discussions take longer than normal, as a result of the price cap being finalised by the EU,” noted OANDA trading platform analyst Craig Erlam.

Beyond the economic gloom, the big unknown in the oil equation currently is Russian oil, as Western nations seek to decouple themselves from Moscow’s energy supplies as fast as possible.

The EU has decided to ban member states from buying Russian oil exported by sea from Monday, “putting at risk over two million barrels per day,” according to estimates by ANZ analysts.

Investors are also scrutinising a European Commission-proposed $60 per barrel price cap on Russian crude, which is designed to reinforce the effectiveness of the EU embargo.

Poland has refused to back the plan, saying the price ceiling should be even lower.

Prices have fallen heavily in recent weeks on expectations of weaker Chinese demand.

There are signs, however, that China is edging towards a pivot from its draconian Covid-zero strategy, which has seen the lockdown of tens of millions and strangled the giant economy this year.

The move came after widespread protests across the country earlier in the week against almost three years of heavy-handed containment measures and calls for more political freedoms.

Observers say they expect officials to signal a shift in priorities at a key meeting later this month, with a focus turning to kickstarting the economy, though with vaccination rates low the move will likely be gradual.

– Key figures around 1435 GMT –

New York – Dow: DOWN 0.7 percent at 34,155.37 points

London – FTSE 100: DOWN 0.1 percent at 7,551.75 

Frankfurt – DAX: FLAT at 14,494.59

Paris – CAC 40: DOWN 0.2 percent at 6,737.97

EURO STOXX 50: DOWN 0.3 percent at 3,972.76

Tokyo – Nikkei 225: DOWN 1.6 percent at 27,777.90 (close)

Hong Kong – Hang Seng Index: DOWN 0.3 percent at 18,675.35 (close)

Shanghai – Composite: DOWN 0.3 percent at 3,156.14 (close)

Euro/dollar: DOWN at $1.0490 from $1.0529 on Thursday

Dollar/yen: DOWN at 135.22 yen from 135.34 yen

Pound/dollar: DOWN at $1.2221 from $1.2251

Euro/pound: DOWN at 85.83 pence from 85.91 pence

Brent North Sea crude: UP 0.4 percent at $87.21 per barrel

West Texas Intermediate: UP 0.5 percent at $81.61 per barrel

President Xi Jinping suggested the spread of the less lethal Omicron strain might allow China to loosen its zero-Covid policy, senior EU officials reported Friday, as cities across the country made further moves towards unwinding some restrictions.

Discontent with China’s hardline pandemic response spilled onto the streets last weekend and expanded into calls for more political freedom, in widespread demonstrations not seen in decades.

China’s vast security apparatus has moved swiftly to smother the rallies, deploying a heavy police presence while boosting online censorship and surveillance of the population.

In his first known comments on the protests, Xi told European Union chief Charles Michel that the demonstrators were “mainly students or teenagers in university” who were fed up with Covid restrictions when the pair met in Beijing on Thursday, senior officials speaking on condition of anonymity said.

Xi complained “that after three years of Covid that he had an issue because people were frustrated”, they said.

They added that Xi had told Michel that given most cases in China were now of the Omicron variant, that “opens the way for more openness of the restrictions than what we have already seen in some regions”.

Chinese central government officials have already signalled that a broader relaxation of the zero-Covid policy could be in the works.

Speaking at the National Health Commission Wednesday, Vice Premier Sun Chunlan said the Omicron variant was weakening and vaccination rates were improving, according to the state-run Xinhua news agency.

A central figure behind Beijing’s pandemic response, Sun said this “new situation” required “new tasks”.

She made no mention of zero-Covid in those remarks or in another meeting on Thursday, suggesting the approach, which has disrupted the economy and daily life, might soon be relaxed.

– Home quarantine? –

A number of cities have now begun loosening Covid restrictions, slowly moving away from daily mass testing and compulsory central quarantine — a tedious mainstay of life under zero-Covid policy.

But sporadic localised clashes have continued to flare up.

Social media footage posted Thursday night and geolocated by AFP showed dozens of people clashing with health workers in hazmat suits outside a school in Yicheng, in central China’s Hubei province.

The author of the post said people in the video were parents of students who had tested positive for the virus and been taken to quarantine facilities.

Parents are seen kneeling in front of the school gate, pleading to take their children home. Another video showed at least a dozen police officers at the scene.

But signs have emerged of a possible shift in the policy of sending positive cases to central quarantine facilities.

An analysis by state-run newspaper People’s Daily on Friday quoted a number of health experts supporting local government moves to allow patients to quarantine at home, which would be a marked departure from current rules.

When called on Friday, some officials in the Chaoyang district of Beijing said people who tested positive there would no longer have to go to central quarantine.

Authorities in the southern factory hub of Dongguan on Thursday also said those who meet “specific conditions” should be allowed to quarantine at home. They did not specify what those conditions would be.

Shenzhen, a southern tech hub, on Wednesday rolled out a similar policy.

– Testing loosens up –

The southwestern metropolis of Chengdu from Friday no longer required a recent negative test result to enter public places or ride the metro, instead only demanding a green health code on an app confirming people have not travelled to a “high-risk” area.

Beijing also announced Friday that using public transport in the city would no longer require a negative PCR test taken within 48 hours.

The day before, the capital’s health authorities called on hospitals not to deny treatment to people without a 48-hour test.

In January, a pregnant woman in the city of Xi’an miscarried after being refused hospital entry for not having a PCR result.

China has seen a string of deaths after treatment was delayed by Covid restrictions, including the recent death of a four-month-old baby who was stuck in quarantine with her father.

Those cases became a rallying cry during the protests, with a viral post listing the names of those who died because of alleged negligence linked to the pandemic response.

Many other cities with virus outbreaks are allowing restaurants, shopping malls and even schools to reopen, in a clear departure from previous tough lockdown rules.

In the northwestern city of Urumqi, where the fire that killed ten people and became the catalyst for the anti-lockdown protests took place, authorities announced Friday that supermarkets, hotels, restaurants and ski resorts would gradually be reopened.

The city of more than four million in the far-western Xinjiang region endured one of China’s longest lockdowns, with some areas shut from early August.

European stock markets and oil prices steadied Friday before key US jobs data and an oil output decision by OPEC and its Russia-led allies.

Asian stock markets and the dollar dropped following another volatile week for markets generally.

“Traders are jockeying for position ahead of the moderately high-risk (US jobs) event,” noted SPI Asset Management’s Stephen Innes.

The data will provide the most recent snapshot of how the world’s top economy is faring in light of rising US interest rates to combat the highest inflation in decades.

Traders are growing confident that the Federal Reserve will slow its pace of rate hikes after Fed boss Jerome Powell this week indicated that the days of jumbo 0.75-percentage-point increases were over.

At the same time, Powell and other Fed officials have lined up to warn that rates would continue to rise and stay elevated, with the possibility of no cut until 2024.

– OPEC+ –

Focus was also on OPEC+, which may decide Sunday to slash oil production further to boost prices for its members, which include Saudi Arabia and Russia.

“There remains considerable uncertainty around the action OPEC+ will take when it meets…, although there’s every chance that the meeting will be delayed or that discussions take longer than normal, as a result of the price cap being finalised by the EU,” noted OANDA trading platform analyst Craig Erlam.

Beyond the economic gloom, the big unknown in the oil equation currently is Russian oil, as Western nations seek to decouple themselves from Moscow’s energy supplies as fast as possible. 

The EU has decided to ban member states from buying Russian oil exported by sea from December 5, “putting at risk over two million barrels per day,” according to estimates by ANZ analysts.

Investors are also scrutinising a European Commission-proposed $60 per barrel price cap on Russian crude, which is designed to reinforce the effectiveness of the EU embargo.

Prices have fallen heavily in recent weeks on expectations of weaker Chinese demand.

There are signs, however, that China is edging towards a pivot from its draconian Covid-zero strategy, which has seen the lockdown of tens of millions and strangled the giant economy this year.

The move came after widespread protests across the country earlier in the week against almost three years of heavy-handed containment measures and calls for more political freedoms.

Observers say they expect officials to signal a shift in priorities at a key meeting later this month, with a focus turning to kickstarting the economy, though with vaccination rates low the move will likely be gradual.

“The language (at the meeting) will prioritise economic growth more than it did the last couple of years,” said Arthur Budaghyan at BCA Research. “Economic conditions are worsening, and policymakers’ pain point is being reached.”

– Key figures around 1200 GMT –

London – FTSE 100: DOWN 0.2 percent at 7,540.43 points

Frankfurt – DAX: UP 0.3 percent at 14,530.90

Paris – CAC 40: DOWN 0.2 percent at 6,742.29

EURO STOXX 50: DOWN 0.1 percent at 3,982.08

Tokyo – Nikkei 225: DOWN 1.6 percent at 27,777.90 (close)

Hong Kong – Hang Seng Index: DOWN 0.3 percent at 18,675.35 (close)

Shanghai – Composite: DOWN 0.3 percent at 3,156.14 (close)

New York – Dow: DOWN 0.6 percent at 34,395.01 (close)

Euro/dollar: UP at $1.0534 from $1.0529 on Thursday

Dollar/yen: DOWN at 134.09 yen from 135.34 yen

Pound/dollar: UP at $1.2277 from $1.2251

Euro/pound: DOWN at 85.82 pence from 85.91 pence

Brent North Sea crude: UP 0.5 percent at $87.27 per barrel

West Texas Intermediate: UP 0.2 percent at $81.35 per barrel

Cities across China further unwound Covid restrictions Friday, loosening testing and quarantine rules in the wake of nationwide protests calling for an end to lockdowns and greater political freedoms.

Anger and frustration with China’s hardline pandemic response spilled onto the streets last weekend in widespread demonstrations not seen in decades.

China’s vast security apparatus has moved swiftly to smother the rallies, deploying a heavy police presence while boosting online censorship and surveillance of the population.

A number of cities have now begun loosening Covid restrictions, such as moving away from daily mass testing — a tedious mainstay of life under Beijing’s stringent zero-Covid policy.

But sporadic localised clashes have continued to flare up.

Social media footage posted Thursday night and geolocated by AFP showed dozens of people clashing with health workers in hazmat suits outside a school in Yicheng, in central China’s Hubei province.

The author of the post said people in the video were parents of students who had tested positive for the virus and been taken to quarantine facilities.

Parents are seen kneeling in front of the school gate, pleading to take their children home. Another video showed at least a dozen police officers at the scene.

– Home quarantine –

Signs have emerged of a possible shift in the policy of sending positive cases to central quarantine facilities.

An analysis by state-run newspaper People’s Daily on Friday quoted a number of health experts supporting local government moves to allow patients to quarantine at home, which would be a marked departure from current rules.

When called on Friday, some officials in the Chaoyang district of Beijing said people who tested positive there would no longer have to go to central quarantine.

Authorities in the southern factory hub of Dongguan on Thursday also said those who meet “specific conditions” should be allowed to quarantine at home. They did not specify what those conditions would be.

The southern tech hub of Shenzhen on Wednesday rolled out a similar policy.

Central government officials have signalled that a broader relaxation of the zero-Covid policy could be in the works.

Speaking at the National Health Commission Wednesday, Vice Premier Sun Chunlan said the Omicron variant was weakening and vaccination rates were improving, according to the state-run Xinhua news agency.

A central figure behind Beijing’s pandemic response, Sun said this “new situation” required “new tasks”.

She made no mention of zero-Covid in those remarks or in another meeting on Thursday, suggesting the approach, which has disrupted the economy and daily life, might soon be relaxed.

– Testing loosens up –

The southwestern metropolis of Chengdu from Friday no longer required a recent negative test result to enter public places or ride the metro, instead only demanding a green health code on an app confirming people have not travelled to a “high-risk” area.

Beijing also announced Friday that using public transport in the city would no longer require a negative PCR test taken within 48 hours. 

The day before, the capital’s health authorities called on hospitals not to deny treatment to people without a 48-hour test.

In January, a pregnant woman in the city of Xi’an miscarried after being refused hospital entry for not having a PCR result.

China has seen a string of deaths after treatment was delayed by Covid restrictions, including the recent death of a four-month-old baby who was stuck in quarantine with her father.

Those cases became a rallying cry during the protests, with a viral post listing the names of those who died because of alleged negligence linked to the pandemic response.

Many other cities with virus outbreaks are allowing restaurants, shopping malls and even schools to reopen, in a clear departure from previous tough lockdown rules.

In the northwestern city of Urumqi, where a fire that killed 10 people spurred anti-lockdown protests, authorities announced Friday that supermarkets, hotels, restaurants and ski resorts would gradually be reopened.

The city of more than four million in the far-western Xinjiang region endured one of China’s longest lockdowns, with some areas shut from early August.

The dollar struggled to recover Friday from its recent sell-off as traders grew confident the Federal Reserve will slow its pace of interest rate hikes, while a recent equities rally sputtered as focus turns to key US jobs data.

Another positive inflation data release out of the United States added to expectations that the US central bank will take a lighter approach to lifting borrowing costs at its December meeting.

The personal consumption expenditures price index data came a day after Fed boss Jerome Powell indicated that the days of 75 percentage-point rate increases were gone as officials pore over the impact of tightening on the economy.

A report showing factory activity shrinking in November added to the sense that the Fed moves were kicking in.

The developments gave forex traders another reason to shift out of the dollar, pushing it down against its major peers — having surged this year on the back of hawkish Fed policy.

The greenback was under particular pressure from the yen Thursday, having hit a three-decade high in October, while sterling and the yuan were also well up from the record lows touched recently.

The US unit was unable to break higher on Friday.

But several Fed officials including Powell have lined up to warn that rates will continue to rise and stay elevated, with the possibility of no cut until 2024.

While the mood on trading floors has become much lighter, equity investors took a step back from their latest buying spree as they awaited the release of the closely watched non-farm payrolls report later Friday.

The figures will provide the most recent snapshot of how the world’s top economy is faring in light of the higher rates and four-decade-high inflation.

“Stocks are grinding a touch lower in Asia after a directionless US session, which sees local traders book some profits ahead of the non-farm payroll report,” said SPI Asset Management’s Stephen Innes.

“A strong report could still reinforce the Fed’s hawkish ambitions. So traders are jockeying for position ahead of the moderately high-risk event.”

Hong Kong, Shanghai, Tokyo, Sydney, Seoul, Mumbai, Bangkok, Singapore, Taipei, Wellington, Manila and Jakarta all fell.

London, Paris and Frankfurt all opened in the red.

Investors were following developments in China amid signs it is edging towards a pivot from its draconian Covid-zero strategy, which has seen the lockdown of tens of millions and strangled the giant economy this year.

The move came after widespread protests across the country earlier in the week against almost three years of heavy-handed containment measures and calls for more political freedoms.

Observers say they expect officials to signal a shift in priorities at a key meeting later this month, with a focus turning to kickstarting the economy, though with vaccination rates low the move will likely be gradual.

“The language (at the meeting) will prioritise economic growth more than it did the last couple of years,” Arthur Budaghyan, at BCA Research Inc, said.

“Economic conditions are worsening, and policymakers’ pain point is being reached.”

– Key figures around 0820 GMT –

Tokyo – Nikkei 225: DOWN 1.6 percent at 27,777.90 (close)

Hong Kong – Hang Seng Index: DOWN 0.3 percent at 18,675.35 (close)

Shanghai – Composite: DOWN 0.3 percent at 3,156.14 (close)

London – FTSE 100: DOWN 0.3 percent at 7,539.42

Euro/dollar: DOWN at $1.0516 from $1.0529 on Thursday

Dollar/yen: DOWN at 134.60 yen from 135.34 yen

Pound/dollar: DOWN at $1.2249 from $1.2251

Euro/pound: DOWN at 85.84 pence from 85.91 pence

West Texas Intermediate: UP 0.4 percent at $81.53 per barrel

Brent North Sea crude: UP 0.6 percent at $87.41 per barrel

New York – Dow: DOWN 0.6 percent at 34,395.01 (close)

Cities across China further unwound Covid restrictions Friday, loosening testing and quarantine rules in the wake of nationwide protests calling for an end to lockdowns and greater political freedoms.

Anger and frustration with China’s hardline pandemic response spilled out onto the streets last weekend in widespread demonstrations not seen in decades.

In the wake of the unrest across China, a number of cities have begun loosening Covid restrictions, such as moving away from daily mass testing requirements, a tedious mainstay of life under Beijing’s stringent zero-Covid policy.

At the same time, authorities are continuing to seek to contain protests with heavy security on the streets, online censorship in full force, and surveillance of the population heightened.

As of Friday, the southwestern metropolis of Chengdu will no longer require a recent negative test result to enter public places or ride the metro, instead only requiring a green health code confirming they have not travelled to a “high risk” area.

In Beijing, health authorities called on Thursday on hospitals not to deny treatment to people without a negative PCR test taken within 48 hours.

In January, a pregnant woman in the city of Xi’an miscarried after being refused hospital entry for not having a PCR test result.

China has seen a string of deaths after treatment was delayed by Covid restrictions, including the recent death of a four-month-old baby who was stuck in quarantine with her father.

Those cases became a rallying cry during the protests, with a viral post listing the names of those who died because of alleged negligence linked to the pandemic response.

Many other cities with virus outbreaks are allowing restaurants, shopping malls and even schools to reopen, in a clear departure from previous tough lockdown rules.

In northwestern Urumqi, where a fire that killed ten people was the spark for the anti-lockdown protests, authorities announced Friday that supermarkets, hotels, restaurants, and ski resorts would gradually be opened. 

The city of over four million residents endured one of China’s longest lockdowns, with some areas shut in early August.

– Home quarantine –

An analysis by state-run newspaper People’s Daily on Friday quoted a number of health experts supporting local government moves to allow positive cases to quarantine at home.

The shift would be a marked departure from current rules, which require that they be held in government facilities.

The southern factory hub of Dongguan Thursday said that those who meet “specific conditions” should be allowed to quarantine at home. It did not specify what those conditions would be.

The southern tech hub Shenzhen rolled out a similar policy Wednesday.

Central government officials have also signalled that a broader relaxation of zero-Covid policy could be in the works.

Speaking at the National Health Commission Wednesday, Vice Premier Sun Chunlan said the Omicron variant was weakening and vaccination rates were improving, according to the state-run Xinhua news agency.

A central figure behind Beijing’s pandemic response, Sun said this “new situation” required “new tasks”.

She made no mention of zero-Covid in those remarks or in another meeting on Thursday, suggesting the approach, that has disrupted the economy and daily life, might soon be relaxed.

The dollar struggled to recover on Friday from its recent sell-off as traders grew confident the Federal Reserve will slow its pace of interest rate hikes, while an equities rally sputtered ahead of key US jobs data.

Another positive inflation data release out of the United States added to expectations that the US central bank will take a lighter approach to lifting borrowing costs at its December meeting.

The personal consumption expenditures price index data came a day after Fed boss Jerome Powell indicated that the days of 75 percentage-point rate increases were gone as officials pore over the impact of tightening on the economy.

A report showing factory activity shrinking in November added to the sense that the Fed moves were kicking in.

The developments gave forex traders another reason to shift out of the dollar, pushing it down against its major peers — having surged this year on the back of hawkish Fed policy.

The greenback was under particular pressure from the yen Thursday, having hit a three-decade high in October, while sterling and the yuan were also well up from the record lows touched recently.

The US unit was unable to break higher on Friday.

However, several Fed officials including Powell have lined up to warn that rates will continue to rise and stay elevated, with the possibility of no cut until 2024.

While the mood on trading floors has become much lighter, equity investors took a step back from their latest buying spree as they awaited the release of the closely watched non-farm payrolls report later Friday.

The figures will provide the most recent snapshot of how the world’s top economy is faring in light of the higher rates and four-decade-high inflation.

“Stocks are grinding a touch lower in Asia after a directionless US session, which sees local traders book some profits ahead of the non-farm payroll report,” said SPI Asset Management’s Stephen Innes.

“A strong report could still reinforce the Fed’s hawkish ambitions. So traders are jockeying for position ahead of the moderately high-risk event.”

Tokyo, Sydney, Seoul, Singapore, Taipei, Wellington, Manila and Jakarta all fell.

However, Hong Kong and Shanghai were again the standout performers, boosted by hopes that China is edging towards a pivot from its draconian Covid-zero strategy that has locked down tens of millions and strangled the giant economy.

The move came after widespread protests across the country earlier in the week against almost three years of heavy-handed containment measures and calls for more political freedoms, which have rattled the leadership of Xi Jinping.

– Key figures around 0230 GMT –

Tokyo – Nikkei 225: DOWN 1.9 percent at 27,679.84 (break)

Hong Kong – Hang Seng Index: UP 0.5 percent at 18,822.49

Shanghai – Composite: UP 0.1 percent at 3,167.57

Euro/dollar: DOWN at $1.0514 from $1.0529 on Thursday

Dollar/yen: DOWN at 135.10 yen from 135.34 yen

Pound/dollar: DOWN at $1.2240 from $1.2251

Euro/pound: DOWN at 85.90 pence from 85.91 pence

West Texas Intermediate: UP 0.2 percent at $81.39 per barrel

Brent North Sea crude: UP 0.3 percent at $87.12 per barrel

New York – Dow: DOWN 0.6 percent at 34,395.01 (close)

London – FTSE 100: DOWN 0.2 percent at 7,558.49 (close)

Stocks diverged Thursday after Federal Reserve boss Jerome Powell signalled a moderation in interest rate hikes, as fears over the health of the global economy persist.

Asian and European equities mainly tacked higher as investors eyed news that eurozone unemployment plumbed to a record-low 6.5 percent in October.

But on Wall Street, the three main indices were down in mid-afternoon trading after a slew of mixed data from the United States, as markets balance recession concerns with relief over inflation slowing down.

One survey showed the US manufacturing sector contracted in November for the first time since mid-2020 when the country struggled with the coronavirus pandemic.

“Manufacturing clearly is struggling in the wake of significantly higher borrowing costs,” said Kieran Clancy, senior US economist at Pantheon Macroeconomics.

Another release meanwhile showed a closely-watched measure of US inflation edged down in October.

“The mood has been enhanced by the reaction to Fed chairman Powell’s comments on the potential for a dialling down of the pace of rate hikes when the FOMC (Fed policy) next meets in just under a fortnight’s time,” said Michael Hewson of CMC Markets.

“However the gains are being tempered by concerns over the extent of some of the economic data weakness being seen today,” he added.

Oil prices climbed before this weekend’s OPEC output meeting of key crude producing nations.

– ‘Moderate’ pace –

In a much-anticipated speech Wednesday, Powell said the full effects of the Fed’s belt-tightening had yet to be felt but that it “makes sense to moderate the pace of our rate increases as we approach the level of restraint that will be sufficient to bring inflation down”.

He signalled the US central bank’s December gathering would likely see officials lift borrowing costs by 50 basis points.

The Fed has yanked up rates by a bumper 75 points at each of the last four meetings.

However, Powell did say policy would need to remain tight “for some time” to restore price stability, echoing comments from other Fed officials who suggested there might not be any cuts until 2024.

Analysts said the reaction to Powell’s remarks — which had been expected to be his most dovish in some time — highlighted a sense of relief among investors that a long-hoped-for pivot was on the cards.

On Thursday, the Fed’s preferred inflation measure — the personal consumption expenditures (PCE) price index — rose six percent from a year ago in October, down from a larger jump the month before.

– Asian gains –

In Asia, Hong Kong extended gains into a third day, with tech giants including Alibaba and Tencent tracking massive gains in their US-listed stock, while Shanghai was also up.

Equities were also helped by signs that China is edging towards a more pragmatic approach to fighting the coronavirus, having hammered the economy this year with its strict zero-Covid strategy of lockdowns and mass testing.

After widespread unrest against the measures — and calls for more political freedoms — authorities have announced moves aimed at loosening some restrictions.

The dollar sank, having soared across the board this year as Fed monetary policy diverged more and more from other central banks.

– Key figures around 1645 GMT –

New York – Dow: DOWN 0.9 percent at 34,276.35 points

EURO STOXX 50: UP 0.5 percent at 3,984.50

London – FTSE 100: DOWN 0.2 percent at 7,558.49 (close)

Frankfurt – DAX: UP 0.6 percent at 14,490.30 (close)

Paris – CAC 40: UP 0.2 percent at 6,753.97 (close)

Tokyo – Nikkei 225: UP 0.9 percent at 28,226.08 (close)

Hong Kong – Hang Seng Index: UP 0.8 percent at 18,736.44 (close)

Shanghai – Composite: UP 0.5 percent at 3,165.47 (close)

Euro/dollar: UP at $1.0498 from $1.0406 on Wednesday

Dollar/yen: DOWN at 135.60 yen from 138.07 yen

Pound/dollar: UP at $1.2248 from $1.2058

Euro/pound: DOWN at 85.69 pence from 86.30 pence

Brent North Sea crude: UP 1.2 percent at $88.00 per barrel

West Texas Intermediate: UP 1.9 percent at $82.07 per barrel

burs-raz/kjm

Global stocks mostly rose Thursday as Federal Reserve boss Jerome Powell flagged a moderation in interest rate hikes, while China signalled a softer approach to fighting Covid.

Asian and European equities tacked higher as investors also eyed news that eurozone unemployment plumbed to a record-low 6.5 percent in October.

On Wall Street, the Dow was down but the Nasdaq and S&P 500 rose after a closely-watched measure of US inflation edged down in October, data showed Thursday, in news likely to bring more relief following Powell’s comments.

Oil prices climbed before this weekend’s OPEC output meeting of key crude producing nations.

– ‘Positive news’ –

“Powell… signalled a potential slowing of interest rate hikes,” noted equity analyst Matt Britzman at UK stockbroker Hargreaves Lansdown.

“Markets have been clinging to every scrap of positive news lately and this was a continuation of that trend.”

In a much-anticipated speech Wednesday, Powell said the full effects of the Fed’s belt-tightening had yet to be felt but that it “makes sense to moderate the pace of our rate increases as we approach the level of restraint that will be sufficient to bring inflation down”.

He signalled the US central bank’s December gathering would likely see officials lift borrowing costs by 50 basis points.

The Fed has yanked up rates by a bumper 75 points at each of the last four meetings.

However, Powell did say policy would need to remain tight “for some time” to restore price stability, echoing comments from other Fed officials who suggested there might not be any cuts until 2024.

Analysts said the reaction to Powell’s remarks — which had been expected to be his most dovish in some time — highlighted a sense of relief among investors that a long-hoped-for pivot was on the cards.

On Thursday, the Fed’s preferred inflation measure — the personal consumption expenditures (PCE) price index — rose six percent from a year ago in October, down from a larger jump the month before.

– Santa Rally on cards? –

“For the first time in an age it feels like Powell is telling markets what they want to hear,” said AJ Bell investment director Russ Mould.

“The message that an easing in the pace of rate hikes could come before the end of the year was just what investors were looking for and raises the prospect of a Santa Rally heading into Christmas.”

The main US indices had surged in response on Wednesday, with the Nasdaq leading the way as rate-sensitive tech firms rocketed.

Hong Kong extended gains into a third day, with tech giants including Alibaba and Tencent tracking massive gains in their US-listed stock, while Shanghai was also up.

Equities were also helped by signs that China is edging towards a more pragmatic approach to fighting the coronavirus, having hammered the economy this year with its strict zero-Covid strategy of lockdowns and mass testing.

“We shouldn’t be naive to the fact that a move away from the (Covid-zero) policy won’t be easy and there’ll be plenty of setbacks. But it’s certainly a step in the right direction,” said OANDA’s Craig Erlam.

After widespread unrest against the measures — and calls for more political freedoms — authorities have announced moves aimed at loosening some restrictions.

The dollar sank, having soared across the board this year as Fed monetary policy diverged more and more from other central banks.

– Key figures around 1430 GMT –

London – FTSE 100: FLAT at 7,569.10 points

Frankfurt – DAX: UP 0.9 percent at 14,526.68

Paris – CAC 40: UP 0.4 percent at 6,764.67

EURO STOXX 50: UP 0.7 percent at 3,991.82

New York – Dow: DOWN 0.1 percent at 34,538.59

Tokyo – Nikkei 225: UP 0.9 percent at 28,226.08 (close)

Hong Kong – Hang Seng Index: UP 0.8 percent at 18,736.44 (close)

Shanghai – Composite: UP 0.5 percent at 3,165.47 (close)

Euro/dollar: UP at $1.0509 from $1.0406 on Wednesday

Dollar/yen: DOWN at 136.16 yen from 138.07 yen

Pound/dollar: UP at $1.2264 from $1.2058

Euro/pound: DOWN at 85.68 pence from 86.30 pence

Brent North Sea crude: UP 2.0 percent at $88.75 per barrel

West Texas Intermediate: UP 2.6 percent at $82.63 per barrel

burs-raz/lth

Global stocks rose further Thursday as Federal Reserve boss Jerome Powell flagged a moderation in interest rate hikes, while China signalled a softer approach to fighting Covid.

Asian and European equities tacked higher as investors also eyed news that eurozone unemployment plumbed to a record-low 6.5 percent in October.

Oil prices climbed before this weekend’s OPEC output meeting of key crude producing nations.

– ‘Positive news’ –

“Powell … signalled a potential slowing of interest rate hikes,” noted equity analyst Matt Britzman at UK stockbroker Hargreaves Lansdown.

“Markets have been clinging to every scrap of positive news lately and this was a continuation of that trend.”

In a much-anticipated speech Wednesday, Powell said the full effects of the Fed’s belt-tightening had yet to be felt but that it “makes sense to moderate the pace of our rate increases as we approach the level of restraint that will be sufficient to bring inflation down”.

He signalled the US central bank’s December gathering would likely see officials lift borrowing costs by 50 basis points.

The Fed has yanked up rates by a bumper 75 points at each of the last four meetings.

However, Powell did say policy would need to remain tight “for some time” to restore price stability, echoing comments from other Fed officials who suggested there might not be any cuts until 2024.

Analysts said the reaction to Powell’s remarks — which had been expected to be his most dovish in some time — highlighted a sense of relief among investors that a long-hoped-for pivot was on the cards.

– Santa Rally on cards? –

“For the first time in an age it feels like Powell is telling markets what they want to hear,” said AJ Bell investment director Russ Mould.

“The message that an easing in the pace of rate hikes could come before the end of the year was just what investors were looking for and raises the prospect of a Santa Rally heading into Christmas.”

All three main indexes on Wall Street surged in response on Wednesday, with the Nasdaq leading the way as rate-sensitive tech firms rocketed.

Hong Kong extended gains into a third day, with tech giants including Alibaba and Tencent tracking massive gains in their US-listed stock, while Shanghai was also up.

Equities were also helped by signs that China is edging towards a more pragmatic approach to fighting the coronavirus, having hammered the economy this year with its strict zero-Covid strategy of lockdowns and mass testing.

After widespread unrest against the measures — and calls for more political freedoms — authorities have announced moves aimed at loosening some restrictions.

The dollar sank, having soared across the board this year as Fed monetary policy diverged more and more from other central banks.

– Key figures around 1115 GMT –

London – FTSE 100: UP 0.1 percent at 7,578.14 points

Frankfurt – DAX: UP 0.7 percent at 14,496.76

Paris – CAC 40: UP 0.2 percent at 6,748.44

EURO STOXX 50: UP 0.6 percent at 3,986.56

Tokyo – Nikkei 225: UP 0.9 percent at 28,226.08 (close)

Hong Kong – Hang Seng Index: UP 0.8 percent at 18,736.44 (close)

Shanghai – Composite: UP 0.5 percent at 3,165.47 (close)

New York – Dow: UP 2.2 percent at 34,589.77 (close)

Euro/dollar: UP at $1.0442 from $1.0406 on Wednesday

Dollar/yen: DOWN at 136.34 yen from 138.07 yen

Pound/dollar: UP at $1.2150 from $1.2058

Euro/pound: DOWN at 85.94 pence from 86.30 pence

Brent North Sea crude: UP 0.6 percent at $87.45 per barrel

West Texas Intermediate: UP 0.7 percent at $81.11 per barrel

burs-rfj/lth