Global stocks steady as US inflation signals BoE to hold line on interest rates

Global stocks were mixed on Tuesday and as fresh data showed that US inflation had cooled on an annual basis in November.

The data from the Bureau of Labor Statistics, which will set the tone for a week filled with central bank meetings, showed prices rose 3.1% over the prior year in November, a slight deceleration from October's 3.2% annual gain.

Economists had expected the Consumer Price Index (CPI) to come in flat month-over-month and rise 3.2% year-over-year, according to data from Bloomberg.

As expected, lower energy costs held the headline figures to a smaller gain, with energy prices dropping 2.3% month-over-month and 5.4% on an annual basis. This was dragged down by falling gas prices, which declined 6.0% during the month of November.

The S&P 500 (^GSPC) fell 0.2% then rose back up to trade 0.2% higher, the Dow (^DJI) ticked up 0.3% and the Nasdaq (^IXIC) was up 0.3%.

The FTSE 100 (^FTSE) rose 0.1% by the closing bell, while the CAC 40 (^FCHI) in Paris fell was almost flat. In Germany, the DAX (^GDAXI) was up 0.1%. The Stoxx 600 (STOXX) opened muted but has since slipped into negative territory.

UK stocks were higher as data showed wage growth slowing and job vacancies falling, signalling the Bank of England could cut interest rates soon to boost the economy.

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Overnight in Asia, the Hang Seng (^HSI) in Hong Kong rose 1.2% to 16,397 while the Shanghai Composite (000001.SS) climbed 0.4% to 3,003 points. Tokyo’s Nikkei 225 (^N225) also finished in the green, advancing 0.2% to 32,843 points.

Producer prices in Japan have risen at a faster-than-expected pace, notching a 0.3% gain year-on-year compared with the 0.1% rise estimated by economists polled by Reuters.

Meanwhile, oil prices rose amid doubts about whether production cuts by OPEC+ next year will balance the crude oversupply and slowing fuel demand growth.

West Texas Intermediate (CL=F) was trading 3.4% lower by the close in London. Brent (BZ=F) crude was 3.2% lower.

Watch: CPI, PPI, Fed decision, retail sales: Market impact

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