With the stock market rebounding, UK inflation is at a 40-year high

LONDON, May 18 (Reuters) – A rebound in equities on Wednesday eased sentiment as economic growth outlook and concerns over rising inflation eased sentiment, underscoring how high the UK inflation rate is at 9%.

Asian stocks were able to gain their fourth consecutive gains, but stocks in Europe were mixed and the future of Wall Street pointed to weak openness.

Many analysts have classified this week’s sharp rally as the short-term hopping of the common type during the long downward trend for stocks. Some are willing to predict the end of sales after the first five months of the year for risky assets that are highly macroeconomic.

“Investors’ sentiment and confidence are trembling and as a result, 3Rs – rates, recession and risk are likely to see volatile and volatile markets until further clarity,” said Mark Heffel, Chief Investment Officer, UBS Global. Wealth management.

At 0810 GMT, the wider Euro STOXX 600 (.STOXX) The UK FTSE 100 is down 0.1% (.FTSE) Was also 0.1% lower.

Wide index of MSCI of Asia-Pacific equities outside Japan (.MIAPJ0000PUS) Up 0.6% and is on its longest winning streak since February. Nikkei of Japan (.N225) 0.94% and miners led the Australian stock (.AXJO) About 1% more.

MSCI Global Equity Index (.MIWD00000PUS) 0.1%, up 2% so far this week, but down 16% from its peak in January.

In the currency markets, sterling suffered heavy losses, falling 0.9% to $ 1.2387 after the UK consumer price inflation touched 9% in April, a 40-year high and roughly in line with analysts’ expectations. The pound has risen sharply this week and is down on some gains on Wednesday.

British inflation is now very high in the major economies, but prices around the world are rising rapidly, forcing central banks to initiate continued rate hikes even as economic growth slows.

Canada’s April inflation measurement will also come after Wednesday.

The US dollar rose 0.3% to 103.61, reversing its two-decade high last week, while the euro fell the same amount to $ 1.0515.

Negative shocks

US retail sales in April helped forecast short-term sentiment, with strong growth and forecasts beating industrial production expectations. read more

Wednesday’s data showed Japan’s economy contracted less than expected in the first quarter. read more

Shanghai is putting an end to its protracted lockout and China’s deputy prime minister has given pleasant comments to technology executives as a recent sign of easing pressure. read more

However, any good news was offset by a reminder by Federal Reserve Chairman Jerome Powell that controlling inflation would require a rate hike and some pain. read more

Investors have set 50 basis points for US rate hikes in June and July and see the benchmark Fed Fund rate rise to 3% early next year.

U.S. Treasury revenues were steady on Wednesday and were below recent multi-year highs, but German 2-year government bond yields peaked after December 2011 on the back of the worst central bank comments. The European Central Bank’s Glass Knot said on Tuesday that a 50 basis point increase in July is possible if inflation rises.

As most of the prices were lower than the recent rise, the commodities marched with stocks this week as the markets found reasons to maintain growth confidence.

Brent crude was up 1.3% at $ 113.38 a barrel on Wednesday, while US crude was up 1.64% at $ 114.24.

The S&P Global Ratings downgraded growth forecasts for China, the United States and the Eurozone, underscoring the weak outlook for the world’s major economies.

“The world economy continues to face an unusually high number of negative shocks,” said Paul F., chief economist. Grunwald said.

“Two developments have changed the macro picture,” he said, pointing to Russia’s invasion and inflation in Ukraine, which has become larger, broader and more consistent than previously thought.

Additional Report by Tom Westbrook in Singapore; Editing by Kim Gokil

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