The Associated Press
Stocks are edging lower in early trading on Wall Street Wednesday as traders wait to hear from the Federal Reserve after its last policy statement of the year. The Fed is widely expected to announce a faster pullback of its stimulus measures as inflationary pressures build. The S&P 500 was off 0.1% in the early going. The benchmark index is coming off two days of losses, pulling it a bit further below the record high it set last Friday. The Nasdaq was down 0.2% and the Dow Jones Industrial Average gave up 0.4%. The yield on the 10-year Treasury rose to 1.46%.
THIS IS A BREAKING NEWS UPDATE. AP’s earlier story follows below.
BANGKOK (AP) — World shares were mixed Wednesday as traders awaited the outcome of the last Federal Reserve meeting of this year.
Benchmarks rose in Paris, Tokyo and Frankfurt but fell in Hong Kong and Shanghai after the U.S. Labor Department reported wholesale prices jumped a record 9.6% in November from a year earlier.
Fed policymakers end a two-day meeting Wednesday where they’re expected to speed up the withdrawal of economic stimulus measures to help tamp down inflation.
China reported its retail sales slowed in November as the country sought to extinguish coronavirus outbreaks.
The virus remains a global concern, with European Commission President Ursula von der Leyen saying omicron will likely be the dominant coronavirus variant in the 27-nation bloc by mid-January. The head of the EU’s executive branch said the bloc is well prepared to fight omicron with 66.6% of the European population now fully vaccinated against the virus.
Germany’s DAX rose 0.4% to 15,520.92 and the CAC 40 in Paris climbed 0.7% to 6,941.03. Britain’s FTSE 100 shed 0.2% to 7,204.90. The futures for the Dow industrials and the S&P 500 were up 0.1%, while the yield on the 10-year Treasury was steady at 1.44%.
In Asian trading, Tokyo’s Nikkei 225 index edged 0.1% higher to 28,459.72 and the Kospi in Seoul added 0.1% to 2,989.39. In Sydney, the S&P/ASX 200 gave up 0.7% to 7,327.10.
Hong Kong’s Hang Seng index slipped 0.9% to 23,420.76, while the Shanghai Composite index lost 0.4% to 3,647.63.
China reported its retail sales slowed in November, rising 3.9% from a year earlier compared with a 4.9% increase in October. Industrial production picked up slightly, growing 3.8% from a year earlier compared with October’s 3.5%.
“COVID-19 remained the key reason holding back a full recovery. Efforts to contain the virus flare-up beginning in mid-October lasted through most of November as infections reached 21 provinces, making consumers more cautious,” Mark Williams and Sheana Yue of Capital Economics said in a commentary.
A second omicron case was reported confirmed in China on Wednesday, underscoring the persisting threat from infections as new coronavirus variants emerge.
On Tuesday, the S&P 500 index fell 0.7% to 4,634.09. It set an all-time high on Friday, when it closed out its biggest weekly gain since February. The index is up 23.4% so far this year.
The Dow dropped 0.3% to 35,544.18. The Nasdaq fell 1.1% to 15,237.64. The Russell 2000 gave up 1% to 2,159.65.
Businesses have been dealing with supply chain problems and higher costs for months and are passing those costs to consumers, who have so far been absorbing higher prices on everything from groceries to clothing and other consumer products. On Friday, the Labor Department reported that consumer prices surged 6.8% for the 12 months ending in November, the biggest increase in 39 years.
The discouraging reports on inflation preceded the Federal Reserve meeting which started Tuesday.
The Fed is expected to more quickly trim its bond purchases, which have helped keep interest rates low and support the stock market and broader economy. Beyond that, investors are watching the central bank for any statements on how soon it might raise interest rates in 2022.
Wall Street is also closely monitoring any news on the omicron variant. It appears to cause less severe disease than previous versions of the coronavirus, according to an analysis of data from South Africa, but has spread quickly. Pfizer’s vaccine seems to offer less defense against infection from it but still offers good protection from hospitalization.
Energy sector stocks fell following a 0.8% drop in the price of U.S. crude oil. On Wednesday, U.S. crude gave up 60 cents to $69.13 per barrel. Brent crude, the basis for international pricing, lost 48 cents to $72.22 per barrel.
The U.S. dollar slipped to 113.69 Japanese yen from 113.73 yen. The euro strengthened to $1.1271 from $1.1259.
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