Asia shares mostly higher following Wall Street rally

by Jonathan Adams
Wall Street slumps

Sensex soared 2.8% to 76,059.59, Hang Seng climbed 2.3% to 18,498.33, the Shanghai Composite index shed 0.5% to 3,071.02, Nikkei 225 gained 1.2% to 38,933.36, the Kospi soared 2% to 2,688.46, S&P/ASX 200 jumped 0.8% to 7,764.30, and the Taiex rose 1.8%

Asian shares began June mostly higher after a report showing that inflation in the U.S. is not worsening drove a rally on Wall Street.

India’s Sensex soared 2.8% to 76,059.59 after the country’s 6-week-long national election came to an end with most exit polls projecting that Prime Minister Narendra Modi will extend his decade in power with a third successive term.

Hong Kong’s Hang Seng climbed 2.3% to 18,498.33, while the Shanghai Composite index dropped in the afternoon, shedding 0.5% to 3,071.02.

Tokyo’s Nikkei 225 gained 1.2% to 38,933.36 and the Kospi in Seoul soared 2% to 2,688.46.

Australia’s S&P/ASX 200 jumped 0.8% to 7,764.30.

In Taiwan, the Taiex rose 1.8%.

On Friday, the S&P 500 added 0.8% to close its sixth winning month in the last seven, ending at 5,277.51. The Dow surged 1.5% to 38,686.32, and the Nasdaq slid less than 0.1% to 16,735.02.

Stocks broadly got a boost from easing Treasury yields in the bond market after the latest data on inflation came in roughly as anticipated, at 2.7% last month.

That could bolster confidence at the Fed that inflation is sustainably heading toward its target of 2%, something it says it needs before it will cut its main interest rate.

Friday’s report from the U.S. government also showed growth in consumer spending weakened by more than economists expected. Growth in incomes for Americans also slowed last month.

Finally, the U.S. economic data is starting to show clear signs that consumers are feeling the pinch. With savings running dry, prices skyrocketing, the job market cooling down, disposable incomes taking a hit, and interest rates still high, spending in 2022 is becoming impossible. It is like trying to fill a bucket with a hole in it — good luck keeping it full, said Stephen Innes of SPI Asset Management said in a commentary.

The yield on the 10-year Treasury dropped to 4.50% Friday from 4.55% late Thursday. It had topped 4.60% earlier in the week amid concerns about weak demand following some auctions for Treasuries, a move that had hurt stocks.

Virtually no one expects the Fed to cut interest rates at its next meeting in a week and a half, but most expect the Federal Reserve will cut at least once by the end of the year, as per data from CME Group.

Disclaimer: The opinions expressed by our writers are their own and do not represent the views of Trading and Investment News. The information provided on Trading and Investment News is intended for informational purposes only. Trading and Investment News is not liable for any financial losses incurred. Conduct your own research by contacting financial experts before making any investment decisions.

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