US stocks opened with gains on Wednesday as core inflation showed a modest monthly increase below estimates, which may push the Federal Reserve to put the brakes on a rate hike.
The Dow Jones soared 200 points, or 0.6%, to 35,466 at 9.50 a.m. EDT, while the S&P 500 added 12, or 0.3%, to 4,497 points. The Nasdaq was up 7, or 0.05%, to 14,795.
Core consumer prices that exclude food and energy, which is closely watched by the Fed as an important inflation indicator, rose 0.3% in July from the previous month, less than estimates of 0.4%. It was up 4.3% year-on-year — in line with expectations.
Although inflation hovers above the Fed’s target of 2%, the central bank may look longer to make a rate hike since the steep increase in consumer prices has almost stalled.
This has led to a decline in the US dollar index, which fell 0.12% to $92.94. The yield on 10-year US Treasury notes added 1.27% to 1.359.
The VIX volatility index, known as the fear index, shed 2.8% to 16.32.
Precious metals rebounded from recent losses with gold rising 0.8% to $1,743 per ounce and silver increasing 0.3% to $23.41.
Oil prices reversed course from Tuesday’s single-day bounce. Brent crude was down 1.4% to $69.68 per barrel and West Texas Intermediate stood at $67.44 — a 1.2% loss.
Optimism in US markets also pushed European indices higher.
STOXX Europe 600, which includes around 90% of the market capitalization of the European market in 17 countries, was at 474.49 points at 1410 GMT with a 0.45% gain.
France’s CAC 40 was up 0.53% at 6,856, while Italy’s Borsa Italiana gained 1% to 26,454.
London’s FTSE 100 and Germany DAX 30 were up 0.7% and 0.5%, respectively, at 7,211 and 15,849 points. IBEX 35 increased 0.77% to 8,967.
Asian stocks closed with gains for a third consecutive day.
The Asia Dow, which includes blue-chip companies in the region, rose 23 points, or 0.6%, to close at 3,916.
Tokyo’s Nikkei 225 stock exchange soared 182, or 0.65%, to 28,070.
The Hang Seng, the benchmark for blue-chip stocks trading on the Hong Kong stock exchange, climbed 54 points, or 0.2%, to 26,660. China’s Shanghai stock exchange was up 2 points, or 0.1%, to 3,532.
Source: Anadolu Agency