US annual inflation slowed to 2.4 percent in September from 2.5 percent in August, according to government reports. This news has influenced stock markets, with shares slipping in New York and Europe as the latest inflation report strengthens the case for a slower pace of interest rate cuts.
In early trading, all three major US Wall Street indexes were lower after the Dow and the S&P 500 reached all-time highs on Wednesday. The Dow was down 0.2 percent, the S&P 500 down 0.3 percent, and the Nasdaq Composite down 0.4 percent.
In Europe, major markets such as Paris and Frankfurt also saw declines, while London remained relatively unchanged. Conversely, in Asia, Chinese stock markets closed with solid gains after the People's Bank of China took action to boost purchases of company shares. The Shanghai Composite closed up 1.3 percent, and Hong Kong’s Hang Seng Index rose 3.0 percent.
Analysts noted that the core measure of inflation, which excludes volatile food and energy costs, rose to 3.3 percent from 3.2 percent, indicating stronger inflation pressures than expected. This, combined with a robust US jobs report from the previous week, has led many to reassess the Federal Reserve's potential interest rate cuts.
In a notable corporate development, shares in GSK jumped more than five percent after the company agreed to pay $2.3 billion in the US to settle lawsuits related to its Zantac heartburn drug.
Additionally, oil prices increased by around 1.5 percent amid ongoing volatility in the crude market, following geopolitical tensions in the Middle East.