Premarket: World stocks rise on rate cut bets

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Yen flounders at 38-year lows

Shares around the world rose on Wednesday as comments from Federal Reserve Chair Jerome Powell reinforced expectations that U.S. rate cuts were not far off, and also made a brief halt to recent rises in Treasury yields and the dollar.

Shaping the broader economic and market picture were Powell’s Tuesday remarks that the U.S. is back on a “disinflationary path,” although he cautioned that policymakers need more data before they can consider cutting interest rates. “Most recent inflation prints have been encouraging. The idea that inflation is not as sticky as anticipated and you could get some policy support is encouraging.”

Investors were also weighing data showing a tight U.S. labor market and will switch their focus to Friday’s nonfarm payrolls data, with U.S. markets shut on Thursday and closing early on Wednesday. Onshore Chinese blue chips were an outlier among rising indexes in Europe and Asia, slipping 0.24%, and China’s yuan eased to a seven-month low against the dollar.

Traders have been on the lookout for signs of Japanese authorities intervening in the currency market to prop up the frail yen, with some analysts suggesting that the line in the sand might be further away than current levels.

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