Australia

Australian shares are set to open flat after a mixed session on Wall Street. US stocks wobbled Wednesday in the wake of new inflation data and the release of the minutes of the September meeting of the Federal Reserve's rate-setting board.

ASX futures were down 6 points or 0.09% at 6639 as of 7:00am on Thursday, pointing to a flat open.

The S&P 500 slipped 0.29%, while the Dow Jones Industrial Average and the Nasdaq Composite were little changed.

Investors have been on edge this week ahead of the release of Thursday's report on consumer prices in the US that will shed light on how much work the Federal Reserve has left to do in containing decades-high price rises. In recent months, inflation gauges have shown widespread pricing pressures on categories like food and housing, while energy prices have eased.

US suppliers increased the prices they charge customers by 0.4% in September from a month earlier, according to data released Wednesday. Economists polled by The Wall Street Journal had expected a 0.2% increase. That comes ahead of Thursday's crucial consumer-price index release.

"Inflation certainly broadened out and entered into areas that were more sticky," said Kiran Ganesh, a multiasset strategist at UBS. "That's why there's been an increase in expectations...that the Fed needs to keep rates at a higher level for longer to get inflation down."

In commodity markets, Brent crude oil slipped 1.9% to $US92.49 a barrel, gold gained 0.48% to US$1,674.34

In local bond markets, the yield on Australian 2 Year government bonds dropped to 3.29% while the 10 Year fell to 3.94%. Overseas, the yield on 2 Year US Treasury notes rose to 4.29% and the yield on the 10 Year US Treasury notes was up at 3.91%.

The Australian dollar hit 62.77 US cents up from the previous close of 62.70. The Wall Street Journal Dollar Index, which tracks the US dollar against 16 other currencies edged down to 104.82.

Asia

Chinese shares ended higher, with the Shanghai Composite Index reclaiming the 3000 level, as sentiment improved thanks to signs of recovering economic conditions, including stronger-than-expected yuan loan growth in September. Renewable-energy stocks pushed the market higher, led by battery maker CATL's 5.2% rise. The stock jumped 11% in two sessions after it released upbeat 3Q earnings guidance. The auto sector also strengthened after recent data from China Passenger Cars Association show passenger car retail sales grew 21.5% in September. BYD Co. added 2.9% and Great Wall Motor was 3.3% higher. The Shanghai Composite Index climbed 1.5% to 3025.51, the Shenzhen Composite Index rose 2.5% and the ChiNext Price Index was 3.6% higher.

Hong Kong stocks ended the session lower, extending a selloff after dropping to a multiyear low Tuesday, after US Fed officials made further hawkish remarks. The benchmark Hang Seng Index declined 0.8% to settle at 16701.03. Losses were spread across sectors. China Merchants Bank slid 5.4%, Chow Tai Fook Jewellery was down 5.2%, while Chinese property developer Country Garden shed 5.0%.0

The Nikkei Stock Average closed flat at 26396.83, amid persistent worries about the global economic outlook. Utility companies ended lower, with Chubu Electric Power falling 1.5% and Kansai Electric Power declining 2.2%. Nissan Motor closed 2.4% lower, after its announcement on Tuesday that it would exit Russia and book a loss equivalent to $686 million.

Europe

European stocks dropped amid recession fears and turbulence in the UK government-bond market. The pan-European Stoxx Europe 600 fell 0.5%, the French CAC 40 backtracked 0.2% and the German DAX shed 0.4%.

"This market remains on edge for further bad news and there's plenty of opportunity over the next two days for either US CPI or bank earnings to give investors a nasty shock," IG analyst Chris Beauchamp wrote. "Today's PPI data hasn't helped much, as it signals that price rises continue to feed through to the broader US economy."

In London, the FTSE 100 closed down 8.9% at 6,826 points amid growing recession fears and the continuing turmoil in the U.K. gilt market, Beauchamp said. The index's top fallers were JD Sports Fashion PLC, Persimmon PLC and Lloyds Banking Group PLC, closing down 10%, 6.2% and 5.8%, respectively.

North America

US stocks wobbled Wednesday in the wake of new inflation data and the release of the minutes of the September meeting of the Federal Reserve's rate-setting board. The S&P 500 slipped 0.29%, while the Dow Jones Industrial Average and the Nasdaq Composite were little changed.

Investors have been on edge this week ahead of the release of Thursday's report on consumer prices in the US that will shed light on how much work the Federal Reserve has left to do in containing decades-high price rises. In recent months, inflation gauges have shown widespread pricing pressures on categories like food and housing, while energy prices have eased.

US suppliers increased the prices they charge customers by 0.4% in September from a month earlier, according to data released Wednesday. Economists polled by The Wall Street Journal had expected a 0.2% increase. That comes ahead of Thursday's crucial consumer-price index release.

"Inflation certainly broadened out and entered into areas that were more sticky," said Kiran Ganesh, a multiasset strategist at UBS. "That's why there's been an increase in expectations...that the Fed needs to keep rates at a higher level for longer to get inflation down."

The Fed released on Wednesday afternoon the minutes of its September meeting, which showed officials concerned over the persistence of high inflation and expecting that bringing prices and wages down would likely require the labor market to weaken.

The Fed's stance has heightened the risk of a recession, but it doesn't appear the economy is in one now, said Merk Investments strategist Nicholas Reece. A recession may in fact come as late as the second half of next year, he said. That, however, likely means the market may churn along for several more months before finally hitting a cycle low. "That's one of the things hanging over this market," he said.

Corporate earnings over the next several weeks will also provide insight into how businesses are dealing with price pressures. PepsiCo on Wednesday again lifted its sales outlook for the year as it continues to push through price increases on its snacks and drinks, sending shares up 4.1%.