The Australian stock market dropped sharply in early trading after investors were spooked by the outlook for interest rates, following a worse-than-expected US inflation report. 7NEWS
dropped sharply in early trading on Wednesday after investors were spooked by the outlook for interest rates, following a worse-than-expected US inflation report.
In the US overnight, the S&P500 tumbled 4.3 per cent - its worst trading day since June 11, 2020 - after the monthly consumer price index came in higher than expected, despite falling fuel prices. The US market now anticipates the US Federal Reserve will dish out another 75 basis point interest rate rise next week, Ms Timbrell said, and there’s even a chance for a 100 basis point hike.AAP
Higher interest rates are generally a negative for share markets because, if decent returns are available on bonds and savings accounts, riskier equities look less attractive.