World stocks extend week-long rebound after slew of US data

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Aug 16 - Global shares pushed higher on Friday, adding to weekly gains, after encouraging U.S. economic data helped soothe fears of a recession in the world's largest economy.

The VIX U.S. stock volatility index , broadly considered the market's fear gauge, sat at benign levels of about 15 after hitting a four-year high of 65 early last week. On Friday, a survey showed that U.S. consumer sentiment rose in August, driven by developments in the U.S. presidential race, while inflation expectations remained unchanged over the next year and beyond.

With central bankers from around the globe set to gather in Jackson Hole, Wyoming, next week, traders expect the Fed to lower borrowing costs from a 23-year high next month but have reduced their bets on an emergency 50-basis-point cut to 25%, down from 55% a week ago, the CME FedWatch tool showed. Japanese stocks gained following heavy losses last week after a surprise Bank of Japan rate cut sent the yen soaring against the dollar, wrecking yen-funded stock trades.

 

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