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World Stocks Hit Record High as Bond Yields Ease

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Global stock markets rose to a record high on Wednesday as bond yields eased after data showed U.S. inflation was not rising wildly as the economy reopens.

Most AsiaPacific share indexes followed Wall Street higher, with Hong Kongs Hang Seng leading gains in the region, while benchmark U.S. Treasury yields continued their decline, marking a fresh threeweek low.

SP 500 futures pointed to a further 0.1 rise.

Japan bucked the trend, with the Nikkei falling 0.3 as rising coronavirus cases raised doubts about its economic recovery with 100 days to go until Tokyo is scheduled to host the Olympics.

European stocks looked set to open modestly higher, with Euro Stoxx futures up 0.3 and Britains FTSE futures 0.1 higher.

The U.S. consumer price index rose 0.6, the biggest increase since August 2012, as rising vaccinations and fiscal stimulus unleashed pentup demand. But the data is unlikely to change Federal Reserve Chair Jerome Powells view that higher inflation in coming months will be transitory.

Powell is scheduled to speak later in the day at the Economic Club of Washington.

The market clearly braced for higher CPI readings, Westpac strategists wrote in a client note.

They said Tuesdays result was clearly being interpreted within the context of the Feds commitment to look through transitory inflation impulses.

For bond markets, the question is whether the benchmark yield can break below 1.6 from as low as 1.611 on Wednesday, they wrote.

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