Stocks mixed ahead of Fed, oil dips on Saudi output recovery
BEIJING (AP) — Global stocks were little changed Wednesday as investors watched for a U.S. Federal Reserve decision on a possible interest rate cut and as oil prices eased on hopes for a quick recovery in Saudi oil supplies.
Benchmarks in London, Frankfurt and Shanghai advanced while Tokyo and Hong Kong slipped and Wall Street futures pointed to small losses on the open.
Investors are looking ahead to a possible Fed decision to cut its benchmark interest rate by another quarter point following a reduction in July that was its first in a decade.
On Tuesday, U.S. shares gained after the Federal Reserve Bank of New York injected $53 billion into the financial sector to ease tight credit conditions that were pushing short-term market interest rates higher.
“The underlying issue is the growing scarcity of excess reserves in the system,” Chris Weston of Pepperstone Group said in a report.
In early trading, London’s FTSE 100 gained 0.1% to 7,324 and Frankfurt’s DAX added 0.1% to 12,386. France’s CAC 40 was 0.2% higher at 5,625.
On Wall Street, futures for the Standard & Poor’s 500 Index and Dow Jones Industrial Average were off 0.1%.
Stock investors also appeared reassured by Saudi Arabi’s statement that half of the oil that had been knocked out by a weekend attack on its facilities has already been restored. The country also said its crude output would be completely restored by the end of the month.
The price of oil had spiked 14% on Monday after the attack led to a production drop of 5% of the global total.
“Concerns surrounding elevated oil prices have eased,” Mizuho Bank said in a report.
In energy markets, the benchmark U.S. crude contract lost 49 cents to $58.85 per barrel in electronic trading on the New York Mercantile Exchange. The contract plunged $3.56 on Tuesday. Brent crude, used to price international oils, fell 36 cents to $64.19 per barrel in London. It sank $4.47 the previous session.
In Asia, the Shanghai Composite Index advanced 0.2% to 2,985.66 while Tokyo’s Nikkei 225 shed 0.2% to 21,960.71. Hong Kong’s Hang Seng retreated 0.1% to 26,754.12.
Seoul’s Kospi gained 0.2% to 2,070.73 while Sydney’s S&P-ASX 200 fell 0.2% to 6,681.60. India’s Sensex advanced 0.3% to 36,592.16.
In currency markets, the dollar gained to 108.18 yen from 108.12 yen on Monday. The euro declined to $1.1054 from $1.1072.