Industrial activity in the United States has increased, suggesting that demand for goods and services remains strong in the United States. Inflationary pressures therefore persist and investors expect the US Federal Reserve to remain in the mood to tighten its policy.
Signals for investors
This is also the reason why American, European and Asian stocks went into negative territory in the middle of the trading week. Investors have received another signal from the US economy that inflationary pressures persist. The Federal Reserve is therefore likely to remain convinced that continuing to raise interest rates is the right way to go for lower inflation.
All three key Wall Street indices weakened from 0.54 (Dow Jones) to 0.75 percent (S&P 500) on Wednesday. Shares in Europe fell even more sharply. The pan-European Stoxx 600 index lost more than one percent, similar to the Madrid Stock Exchange index. London and Milan wrote off less than one percent, the Frankfurt DAX fell by 0.33 percent. Of the Asian markets, the Hong Kong Stock Exchange lost the most, 0.56 percent. The Tokyo Nikkei index, on the other hand, strengthened by 0.65 percent.