Global market news: Stocks mixed after Biden, Powell’s speeches

In his annual State of the Union speech on Tuesday, Biden urged unity and called for a blue-collar economic revival with proposals including a new minimum tax on billionaires.

Traders also eyed comments from Powell, who reiterated on Tuesday that inflation was coming down — but acknowledged that interest rates may need to go higher than expected to get them under control.

Wall Street woke up in the red, but European markets were up in afternoon deals, with London’s FTSE 100 index hitting a record 7,934.30 before paring gains.

In the eurozone, Frankfurt and Paris indices jumped on news of impressive annual profits at French energy major Total Energy and Norwegian peer Equinor, which hammered UK rivals BP and Shell.

The sector has made huge gains as a result of rising oil and gas prices following Russia’s war on Ukraine, a major energy producer.

Oil prices rose on Wednesday on fresh bets a rebound in Chinese demand as the superpower emerges from nearly three years of tough zero-Covid restrictions.

Biden said the massive oil profits were “outrageous” as he called for quadrupling the tax on corporate stock buybacks.

– ‘Soothing message’ –

AJ Bell investment director Russ Mold said Powell had “the soothing message the market was looking for”.

A run of key U.S. data in recent months has indicated a series of bumper hikes began to pay off last year, fueling hopes that the Fed may halt its tightening cycle and that borrowing costs will ease at the end of the year. can also reduce.

But Friday’s forecast-busting jobs report – showing half a million new jobs created in January – fueled speculation that more increases would be on the way.

Mold said, “Amid concerns that last Friday’s bumper jobs report would see the Fed react to what it perceived as an overheating labor market, Powell’s relatively relaxed response probably reflected the seasonal anomalies that often plague January.” affects the numbers.

“Whether Powell will be so relaxed if the next set of payrolls data is similarly inflated is open to question,” he said.

Powell’s comments were similar to what he said after the bank’s latest policy meeting last Wednesday, which had led to a rally in equities.

Fawad Razakzada, an analyst with CityIndex and Forex.com, said Powell’s speech was “overall deemed neutral”.

“Powell acknowledged that a disinflationary process is underway, but also suggested that interest rates may need to be raised further if the jobs data shows an upside surprise,” Razakzada said.

All eyes are now on US inflation data next week.

– Key figures around 1500 GMT –

New York – Dow: down 0.1 percent to close at 34,126.72 points

LONDON – FTSE 100: UP 0.5 percent at 7,907.14

FRANKFURT – DAX: UP 0.9 percent at 15,462.65

PARIS – CAC 40: UP 0.3 percent at 7,153.44

Euro STOXX 50: Up 0.4 percent at 4,226.84

Tokyo – Nikkei 225: Down 0.3 percent at 27,606.46 (close)

Hong Kong – Hang Seng Index: down 0.1 percent at 21,283.52 (close)

Shanghai – Composite: down 0.5 percent at 3,232.11 (close)

EUR/USD: down from $1.0726 on Tuesday to $1.0721

Pound/Dollar: UP from $1.2048 to $1.2067

Euro/Pound: down from 89.04 pence to 88.88 pence

Dollar/yen: UP at 131.36 yen from 131.07 yen

Brent North Sea crude: up 0.9 percent to $84.41 a barrel

West Texas Intermediate: Up 1.2 percent at $78.06 a barrel

BERS-RFJ-LTH/KJM

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BP

Equinor

total energy

The text of this story is published from a wire agency feed without any modification. Only the headline has been changed.