World shares mixed as markets await word from Fed meeting

World shares mixed as markets await word from Fed meeting
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Stocks opened higher in Europe on Tuesday after Asian stocks followed a fall on Wall Street as investors awaited fresh US inflation data and the outcome of the Federal Reserve’s meeting.

Standards advanced in Paris, London and Frankfurt, but fell back in Hong Kong, Shanghai and Tokyo.

The Labor Department’s producer price index for November is due to be released on Tuesday. This shows how inflation affects costs for businesses which is important given the Federal Reserve’s meeting on Tuesday and Wednesday. The US central bank may announce plans to speed up its schedule to reduce bond purchases with the aim of keeping long-term interest rates low.

Markets remained calm despite warnings that the omicron coronavirus was spreading rapidly in Britain and some other regions.

In London, the FTSE 100 rose 0.6% to 7,274.71, while the German DAX added 0.4% to 15,678.78. In Paris, the CAC 40 rose 0.5% to 6,979.16. US futures were also higher, with the S&P 500 and Dow industrials adding 0.3%.

Hong Kong’s benchmark index fell on Tuesday due to continuing concerns about property developers.

Shares of Shanghai-based Shimao Group Holdings plunged 20% in Hong Kong on concerns about its financial condition. China Evergrande Group shares fell 7%. Evergrande is one of the largest real estate developers in China, with more than $300 billion in debt.

Chinese leaders have promised tax cuts and entrepreneur support to shore up sluggish economic growth as the country grapples with bankruptcies and defaults among property developers due to a drive to rein in mounting debt.

“Recent scrutiny of Shimao Group Holdings, China’s 13th largest developer by contract sales, has taken over its liquidity position and its ability to service debt. This may continue to put the real estate sector in check today,” said Yeap Jun Rong of IG.

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