A roundup of trading on major world markets overnight:
NEW YORK – US stocks have risen strongly for the second straight session ahead of the Federal Reserve’s decision on whether to raise interest rates for the first time in nine years.
The Dow Jones Industrial Average rose 140.10 points (0.84 per cent) to 16,739.95.
The broad-based S&P 500 rose 17.22 (0.87 per cent) to 1,995.31, while the tech-rich Nasdaq Composite Index gained 28.72 (0.59 per cent) to 4,889.24.
Weighing whether to finally break from its easy money stance dating to the 2008-2009 crisis, the Fed is scheduled to announce its rate decision at 1800 GMT Thursday (0400 on Friday AEST).
Michael James, managing director of equity trading at Wedbush Securities, said traders increasingly believe the Fed either will not hike rates, or accompany an increase with dovish commentary suggesting additional increases are not planned anytime soon.
Petroleum-linked stocks rallied strongly on a nearly six per cent climb in US oil prices.
LONDON – European stock markets have risen as investors toasted news that Belgian-Brazilian drinks giant AB InBev is brewing a blockbuster takeover bid for Britain’s SABMiller.
London’s benchmark FTSE 100 index climbed 1.49 per cent to close at 6,229.21 points on Wednesday, while in the eurozone Frankfurt’s DAX 30 added 0.38 per cent to finish at 10,227.21 and Paris’s CAC 40 jumped 1.67 per cent to 4,645.84 points.
Madrid shot up 1.99 per cent and Milan gained 0.71 per cent.
SABMiller’s share price rocketed by a fifth in London, topping the FTSE risers’ board, after it revealed that Anheuser-Busch InBev intended to make a bid.
The brewer’s shares ended the day with a gain of 19.89 per cent to 3,614 pence as investors reacted to the surprise news.
HONG KONG – Asian markets have extended a global equities rebound after recent losses while riskier assets and oil prices also ticked up, but dealers remained cautious before the US interest rate decision.
Following steep losses in the previous two sessions, Shanghai again saw volatile trading, swinging from negative to positive early on before surging almost five per cent in the final hour.
“The market is finely balanced on whether the Fed will move or not. There’s been uncertainties about China and global growth, but the US economy looks strong enough to be able to withstand an increase in rates,” James Lindsay at Nikko Asset Management NZ in Auckland told Bloomberg News.
“Uncertainty will continue until we get the news from the Fed.”
Experts have warned that a Fed rise in borrowing costs could severely hurt the struggling world economy, and especially damage emerging markets as investors withdraw cash and turn to the US for better and safer returns.
– AAP
