London — World stocks paused near five-month highs on Wednesday as signs that central banks might need to keep hiking interest rates for longer damped a recent wave of optimism that aggressive monetary tightening is almost done.
Trade in European stocks was lacklustre and the broad Euro Stoxx 600 slipped 0.3%. US stock futures pointed to a soft open for Wall Street . “Our view is that the move in risk assets is overdone,” said Guy Miller, chief market strategist at Zurich Insurance Group. “Broadly speaking, the problem that we have is that economic conditions are getting worse and the data we are looking at points in that direction.”
In currency markets, the Australian dollar strengthened to $0.7123 after the latest inflation data. The unit has risen almost 2% this week and is poised for its biggest weekly jump in more than two months.