Asian stocks retreat as inflation augurs Fed rate hikes

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Shares were mostly lower in Asia on Thursday after the latest report of surging prices in the U.S. appeared to keep the Federal Reserve on track to raise interest rates in coming months.

Tokyo, Shanghai, Hong Kong and Seoul were lower while Sydney advanced. U.S. futures declined, with the contracts for both the S&P 500 and the Dow industrials 0.1% lower.

The Hang Seng in Hong Kong edged 0.1% lower, to 24,379.67 and the S&P/ASX 200 added 0.5% to 7,474.40. India's Sensex edged 0.1% higher. On Wednesday, the S&P 500 rose 0.3% to 4,726.35. The Dow Jones Industrial Average eked out a 0.1% gain, closing at 36,290.32. The Nasdaq composite rose 0.2% to 15,188.39. All are on pace for a weekly gain.Investors were focused on a report from the Labor Department, which showed consumer prices jumped 7% last month. That's the fastest year-over-year pace in the consumer price index in nearly four decades.

The market now puts the chances of the Fed raising short-term rates by at least a quarter point in March at around 75%. A month ago, it was about 36%.

 

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