The equity market seemed to calm down for a while today even though the dollar was still moving flat after the consumer price index (CPI) and producer price index (PPI) data were mixed in favor of the Federal Reserve (Fed).
According to James Bullard, President of the Fed St. Louis, the central bank of the United States (US) still needs to raise interest rates despite the market's 'dovish' policy assumption.
This is because the effect of previous increases 'only bear fruit on observed inflation' and if it increases a lot now then the Fed can reduce it in the first quarter of 2023.
Meanwhile, Wall Street ended Friday's session on a positive note with the Dow Jones Industrials up 0.6% at 33,745.7 while the S&P 500 gained 0.5% at 3,965.3 and the Nasdaq Composite was flat at 11,146.1.
MSCI's global index rallied 15% from its October 13 low and MSCI Asia also surged 15% for 4 straight weeks, heading for its best monthly high since May 2009.
However, the situation this morning looked a little different with Dow Jones futures falling 0.1% while the S&P 500 was flat and the Nasdaq rose 0.1%.
The Asian zone saw the Nikkei 225 add 0.32%, Topix up 0.36%, South Korea's Kospi opened higher, Kosdaq reached 0.18% and Australia's S&P/ASX 200 climbed 0.1%.
On the other hand, investors' focus throughout the week may be directed towards the FOMC minutes which are expected to give an indication of the next interest rate hike as well as preliminary readings of the US services and manufacturing PMIs.
Also not to be missed are consumer sentiment data from the University of Michigan survey, new home sales and the celebration of Thanksgiving in the US.
