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US stocks overcome Fed interest rate jitters

By AFP - Jun 23,2021 - Last updated at Jun 23,2021

In this photo, currency dealers monitor exchange rates in front of screens showing South Korea's benchmark stock index (top right) and the Korean won/CNH exchange rate (top left) in a trading room at KEB Hana Bank in Seoul, on Monday (AFP photo)

LONDON — US stocks mostly pushed higher on Wednesday as interest rate hike fears faded, with the tech-heavy Nasdaq hitting a new-intra day record high.

However, eurozone stocks fell after report showed the economy booming, reinforcing interest rate hike fears there.

Meanwhile, oil prices rose further as reopening economies are set to drive demand higher, with some analysts saying hitting $80 a barrel for crude is increasingly possible.

Wall Street opened the day higher, adding to gains racked up on Tuesday after Fed chief Jerome Powell sought to ease concerns over the timing of higher interest rates in testimony before lawmakers.

"The markets appear to be finding relief from yesterday's dovish testimony on Capitol Hill by Fed Chairman Jerome Powell," said analysts at Charles Schwab brokerage. analyst Patrick O'Hare noted that Wall Street has pretty much recovered from the losses it suffered last week, when fears that the Fed would hike rates and wind down stimulus support to ward off inflation saw the market turn in its worst weekly performance since last October.

The Dow had dipped into the red by late morning, but the Nasdaq composite index struck a fresh record high after having set one on Tuesday.

The S&P 500 is also sitting just below its record high.

O'Hare said the market is back to trading on expectations of rises in commodity prices and gravitating towards sectors that will benefit from the reopening of economies.

Oil climbs 

Oil prices extended gains to sit around multiyear highs on increasing optimism over demand as the world economy reopens and governments talk about easing quarantine measures, allowing easier overseas travel.

Analysts said the lack of progress on the Iran nuclear deal was also providing support as it puts off the return of supplies to the global market from the major producer.

Brent oil hit $76.02 per barrel, the highest level since late October 2018.

"With no prospect of an Iran oil deal in the coming weeks, talk of looser travel restrictions will inevitably provide an upward bias for prices, and a move towards $80 a barrel," said analyst Michael Hewson at CMC Markets UK.

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