Asian Stocks Fall Ahead of US Inflation Update

BEIJING (AP) -- European stocks and Wall Street futures gained Thursday while Asian markets fell ahead of U.S. inflation data that investors worry will reinforce Federal Reserve plans for more aggressive interest rate hikes.

London and Frankfurt advanced. Shanghai, Tokyo and Hong Kong declined. Oil prices advanced.

Wall Street's benchmark S&P 500 ended lower Wednesday after inflation in producer prices edged down but still was near a multi-decade high.

The more closely watched consumer price index was due out later Thursday.

"A hawkish reaction to the data could add more pressure to stocks," Anderson Alves of ActivTrades said in a report.

The Fed and other central banks in Europe and Asia have raised rates by unusually big margins to cool inflation that is at multi-decade highs, but traders are afraid they might tip the global economy into recession.

In early trading, the FTSE 100 in London gained 0.2% to 6,840.35. The DAX in Frankfurt rose 0.8% to 12,272.20 and the CAC 40 in Paris added 0.5% to 5,845.55.

On Wall Street, futures for the benchmark S&P 500 index and the Dow Jones Industrial Average were up 0.5%.

On Wednesday, the S&P 500 gave up 0.3% for its sixth daily decline and the Dow slide 0.1% after a report showed producer price inflation is very hot.

Prices rose 8.5% in September, down from March's peak of 11.7%. But prices gained 0.4% compared with August following two months of declines.

Consumer inflation on Thursday and retail sales data Friday could give a clearer picture of where prices are hottest and how consumers are reacting.

Minutes from the Fed's last meeting, released Wednesday, underscored the central bank's commitment to taming "unacceptably high" inflation.

The S&P 500 is down 25% so far this year and close to a two-year low.

In Asia, the Shanghai Composite Index lost 0.1% to 3,016.35 and the Nikkei 225 in Tokyo sank 0.6% to 26,237.42. Hong Kong's Hang Seng tumbled 1.9% to 16,389.11, its lowest close in more than 11 years.

The Kospi in Seoul fell 1.8% to 2,162.87 while Sydney's S&P-ASX 200 gained less than 0.1% to 6,642.60.

India's Sensex lost 0.7% to 57,205.89. New Zealand's benchmark lost 0.5% and Southeast Asian markets also declined.

In energy markets, benchmark U.S. crude gained 19 cents to $87.64 per barrel in electronic trading on the New York Mercantile Exchange. Brent crude, the price basis for international oil trading, added 31 cents to $92.67 per barrel in London.

The dollar strengthened to 146.74 after hitting a 24-year high of 145.85 on Wednesday.

The dollar's exchange rate has been rising against other currencies due to the Fed's rate hikes and recession fears. The yen's weakness has prompted expectations Japan's central bank might intervene for a second time to prop up the exchange rate following an intervention in September.

The euro gained to 97.39 cents from 97.06 cents.