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Markets rebound after Fed boss calms nerves over rates

Published : Sunday, 15 May, 2022 at 12:00 AM  Count : 307

LONDON, May 15: Global stock markets rebounded Friday on easing fears about the pace of interest rate rises in the United States that are aimed at bringing down the country's highest inflation in decades.
European equities were up around 1.5 percent nearing the half-way stage following solid gains in Asia.
Stocks have suffered sharp losses this week, particularly on Wall Street, as investors seek safety also amid the Ukraine war and Chinese lockdowns.
"Investors are continuing to wrestle with worries over inflation as the oil price climbs back up again and supply concerns resurface amid ongoing geo-political tensions," noted Susannah Streeter, senior investment and markets analyst at Hargreaves Lansdown.
Stocks have tumbled for much of this week on fears the Federal Reserve was planning to lift US interest rates by 75 basis points at a single meeting.
However equities on Friday staged "a relief rally" after Fed boss Jerome Powell calmed nerves over the potential hefty increase, said Jeffrey Halley, analyst at OANDA trading group.
"The rally today looks more like a technical rebound after a torrid week than a structural turn in sentiment," he added.
Oil prices climbed Friday after much volatility, while the euro recovered from five-year lows against the dollar.
Bitcoin held above $30,000, a day after the cryptocurrency slumped under $27,000, or lowest level since late 2020.
Its crash this week was fuelled by the collapse of two so-called "stablecoin" cryptocurrencies -- TerraUSD and Tether -- which proved to be anything but stable, leaving investors panicked.
On the corporate front Friday, Twitter's share price plunged after Elon Musk said he was putting a temporary halt on his much-anticipated deal to buy the social media giant.
"Twitter deal temporarily on hold pending details supporting calculation that spam/fake accounts do indeed represent less than 5% of users," he wrote on the platform.
Musk, the world's richest man and founder of automaker Tesla, had made the eradication of spam accounts and bots one of the centrepieces of his proposed $44 billion takeover of Twitter.
Friday's announcement saw shares drop by 20 percent in early electronic trading before Wall Street opened.    -AFP






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