Australia

Australian shares are expected to gain today. All three major US indices closed up Wednesday after an increase in retail sales boosted hopes for economic resilience.

ASX futures were 34 points or 0.46% higher as of 8:00am on Thursday, pointing to a positive open.

Stocks wavered Wednesday after data showed a rebound in retail sales, a sign of economic strength that could encourage the Federal Reserve to keep combating inflation by raising interest rates.

The indices spent much of the day in the red but managed to close higher.

The S&P 500 gained 0.3%, the Dow Jones Industrial Average added 0.1%, and the Nasdaq Composite Index advanced 0.9%.

New data showed retail sales rose 3% in January, bouncing back from recent declines as jobs growth accelerated.

In commodity markets, Brent crude oil lost 0.34% to $US85.29 a barrel while gold shed 1.02% to US$1,835.34.

The yield on Australian 2 Year government bonds edged higher to 3.44% while the yield on 10 Year government bonds was unchanged at 3.73%. In the US, the yield on 2 Year Treasury notes rose to 4.62% while the yield on 10 Year Treasury notes jumped to 3.81%.

The Australian dollar declined to 68.99 US cents from its previous close of 69.86. The Wall Street Journal Dollar Index, which tracks the US dollar against 16 other currencies, edged up to 96.87.

Asia

Chinese stocks ended lower, extending this week's muted trade, as the market continued to pull back from its strong rally at the beginning of the year. The benchmark Shanghai Composite Index shed 0.4% to settle at 3280.49, while the Shenzhen Composite Index was down 0.1% at 2187.51. The tech-heavy ChiNext Price Index dropped 0.7% to 2547.20. Consumer goods and services companies extended their recent downturn, although investors benefited from the sector's earlier gains. Delivery-services providers and home-appliance makers led losses. Bear Electric Appliance shed 3.6%, Yunda was down 2.9% and YTO Express dropped 5.8%.

Hong Kong's benchmark Hang Seng Index lost 1.4% to 20812.17, dragged by tech stocks and developers. The mood was downcast across equity markets in the region as investors digested the latest US inflation data overnight, which stoked fresh concerns about more rate hikes from the Fed. Shares in tech companies, which are sensitive to tighter monetary policy as higher rates erode the value of growth-stage companies' future earnings, gave up early gains in Hong Kong. The Hang Seng Tech Index closed 1.0% lower, while Alibaba Health lost 4.2% and Meituan dropped 1.8%. Property stocks fell sharply after the state-owned Economic Daily said property policy should target real demand to prevent speculation in the market.

Japanese stocks ended lower, dragged by declines in tech shares, amid continued concerns about policy tightening by central banks and its impact on the economic outlook. Recruit Holdings dropped 4.1% and Z Holdings lost 2.0%. Shimano slid 6.5% after it projected a 33% drop in net profit for 2023. The Nikkei Stock Average fell 0.4% to 27501.86.

India's benchmark Sensex index closed 0.4% higher at 61275.09 amid mixed signals on further interest rate increases from the Federal Reserve, following the release of US CPI data, ICICI Direct Research analysts said in a note. Gains were across sectors. Tech Mahindra closed 5.8% higher, Reliance Industries added 2.2% and Bajaj Finserv gained 1.4%. Decliners included Hindustan Unilever, which was 1.2% lower.

Europe

European stocks rose as investors weighed the latest UK and US inflation data. The pan-European Stoxx Europe 600 gained 0.5%, the German DAX added 0.8% and the French CAC 40 advanced 1.2%.

UK inflation eased more than expected to 10.1% year-on-year in January while US inflation decelerated less than forecast to 6.4% in January. "Although uneven corporate results, combined with the latest inflation prints from both the UK and the US, have brought more short-term uncertainty to the markets, the underlying bullish sentiment has not been significantly impacted so far," ActivTrades analyst Pierre Veyret wrote. Poor performances from healthcare, financials and real estate shares were offset by an appetite for consumer cyclicals and the industrial and technological sectors, he said.

The British FTSE 100 closed up 0.6% at 7997 on Wednesday after breaking the 8000 mark earlier in the session. "It is redemption day for the FTSE 100 as it breached the 8,000 mark after a long spell in the wilderness. The 8,000 level is a purely psychological milestone, but investors in the UK stock market will nonetheless be happily counting their coffers after a year in which it has been one of the best performing major markets," AJ Bell head of investment analysis Laith Khalaf said in a research note. Scottish Mortgage Investment Trust led the risers, ending 4.0% higher, while Barclays was the biggest faller, finishing 7.9% lower.

North America

Stocks wavered Wednesday after data showed a rebound in retail sales, a sign of economic strength that could encourage the Federal Reserve to keep combating inflation by raising interest rates.

The indices spent much of the day in the red but managed to close higher.

The S&P 500 gained 0.3%, the Dow Jones Industrial Average added 0.1%, and the Nasdaq Composite Index advanced 0.9%.

New data showed retail sales rose 3% in January, bouncing back from recent declines as jobs growth accelerated.

"What's happening today and what's happening more broadly in February is that you got a ton of different data points that are better than anyone really expected," said Ross Mayfield, investment strategy analyst at Baird. It shows "that the economy is handling higher rates really well."

As a result, investors are starting to give up on the hope that the Fed will cut rates toward the year's end, Mr. Mayfield said.

Stocks have fluctuated in recent days. Investors are weighing signs of strength in the economy against concern that inflation, which remains elevated even after slowing in recent months, will encourage the Fed to press ahead with efforts to tighten monetary policy.

"There's this pull-push as the market tries to find a resolution in terms of its view on the US economy," said Jane Foley, head of foreign-exchange strategy at Rabobank.

As for individual stocks, Airbnb rose 13% after quarterly earnings beat analysts' forecasts and the travel company recorded its first full-year profit. Stock in TripAdvisor gained 1.5% after the online travel site posted a surge in revenue in its latest quarter, also benefiting from the post-pandemic travel rebound.

About three-quarters of companies in the S&P 500 index have reported fourth-quarter earnings. Of those, about 70% have beaten analyst forecasts for earnings per share, according to FactSet. Companies typically top expectations, though, so those reports have not been sufficient to give the broad market a boost in recent weeks.