Stocks lacklustre, oil drops ahead of Fed chair’s speech

SEOUL, Korea, Republic Of – Global stock markets were subdued and the price of oil fell Wednesday as investors awaited fresh cues from the U.S. Federal Reserve on the outlook for interest rates in the world’s largest economy.

KEEPING SCORE: Britain’s FTSE 100 edged 0.2 per cent lower to 6,852 and Germany’s DAX rose 0.3 per cent to 10,619. The CAC 40 of France rose 0.5 per cent to 4,441. Shares in New York looked poised to hold steady, with S&P futures up 0.1 per cent and Dow futures about flat.

FED WATCH: Investors are awaiting a speech Friday by Fed Chair Janet Yellen at an annual conference of central bankers in Jackson Hole, Wyoming. The Fed is expected to hold off on raising interest rates at its September meeting, but Yellen’s comments will be dissected for clues on the likelihood and timing of a future hike.

TENSIONS IN KOREA: Rattling nerves in northeast Asia, North Korea fired a ballistic missile from a submarine early Wednesday. The missile travelled about 500 kilometres (310 miles) in what officials in Seoul said was the longest flight yet by that type of North Korean weapon, one that could put much of rival South Korea within range.

ASIA’S DAY: Japan’s Nikkei 225 rose 0.6 per cent to 16,597.30 on rising hopes for more monetary stimulus from the Bank of Japan and a raft of government stimulus, while Australia’s S&P/ASX 200 added 0.1 per cent to 5,561.70. But South Korea’s Kospi fell 0.3 per cent to 2,043.76 and Hong Kong’s Hang Seng index lost 1 per cent to 22,820.78. The Shanghai Composite index edged down 0.1 per cent at 3,085.88.

OIL: Prices rose overnight after Iran signalled it might support other OPEC member in production freezes. But they fell back Wednesday on news of rising inventories. Benchmark U.S. crude fell 77 cents to $47.33 per barrel in electronic trading on the New York Mercantile Exchange. The contract rose 69 cents on Tuesday. Brent crude, used to price oil internationally, lost 48 cents to $49.48.

CURRENCIES: The dollar slipped to 100.17 yen from 100.24 the previous day, while the euro fell to $1.1280 from $1.1304.