Global Markets Rebound on Yellen Speech
September 25 2015 - 04:30AM
Dow Jones News
Global stock markets climbed Friday after Federal Reserve
Chairwoman Janet Yellen eased investors' concerns that last week's
decision to keep rates near zero had put off a rate rise for the
foreseeable future.
In a speech on Thursday at the University of Massachusetts in
Amherst, Ms. Yellen laid out a detailed case for raising interest
rates later this year.
European markets climbed sharply at the open, rebounding from
Thursday's losses. The Stoxx Europe 600 was 2.5% higher in early
trade.
The picture in Asia was more mixed. Japanese stocks wavered as
investors digested Ms. Yellen's speech, but finished the session
strongly, with the Nikkei closing up 1.8%. China's Shanghai
Composite fell 1.6%.
Stock markets were "seemingly taking a little heart from less
obfuscation from Yellen," said Marc Ostwald, a strategist at
strategist at ADM Investor Services International.
Shares around the world have fallen since the Fed stood pat last
Thursday, with investors interpreting the central bank's caution as
the latest worrying sign about the state of the global economy.
Many are anxious for the Fed to make a start on returning monetary
policy to normal after years of rock-bottom rates.
Ms. Yellen's speech also gave the dollar a boost. The euro
weakened to $1.1140 against the buck, having climbed to nearly
$1.13 on Thursday. The dollar climbed against the yen to ¥
120.66.
Higher interest rates make a currency more attractive to
investors.
In Europe, shares in the auto sector led Friday's rebound. A
number of car makers had fallen sharply on Thursday as the
emissions scandal enveloping Volkswagen AG threatened to
spread.
BMW AG climbed more than 5%, Daimler AG rose 4%, while
Volkswagen itself was 2.5% higher.
Energy and mining shares also bounced back after heavy
losses.
In commodity markets, Brent crude oil was 0.4% higher at $49.06
a barrel. Gold fell 0.7% to $1,145.50 a troy ounce.
Write to Tommy Stubbington at tommy.stubbington@wsj.com
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(END) Dow Jones Newswires
September 25, 2015 04:15 ET (08:15 GMT)
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