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The local market soared 2.8% on Friday following the release of US inflation data out late on Thursday that hit 7.7% for October, which indicates a slowing of economic growth in the US and prompted investors to believe that inflation has now peaked.
Investors piled into technology stocks which have been sold-off sharply of late as the cost of borrowing financing increases with every interest rate hike, which impacts the growth outlook of tech companies, but with markets now believing inflation in the US has peaked, investors piled back into growth stocks on Friday sending the tech sector up almost 5% in the last trading session of the week.
The best performing stocks on Friday were Megaport (ASX:MP1), which added just over 13.5%, Pinnacle Investment Management (ASX:PNI), which gained 12.5% and Netwealth Group (ASX:NWL), which rose 11.67%. On the other end of the market, the stocks that weighed on the market on Friday were Whitehaven Coal (ASX:WHC) losing almost 3.5%, Origin Energy (ASX:ORG) falling 3.2% and Computershare (ASX:CPU) closing the day down almost 3%.
Wall Street extended its rally into Friday with the key indices closing higher, buoyed by lower-than-expected inflation data released on Thursday indicating the Fed’s aggressive rate hikes to tackle the 40-year high inflation are starting to work. The Dow Jones added 0.1%, the S&P500 jumped 0.92% and the tech-heavy Nasdaq rose 1.88%.
Over in Europe, markets notched their best weekly performance in nearly 8-months on Friday, driven by hopes of smaller rate hikes by the Federal Reserve in the US and on the easing of some COVID-19 restrictions in China. The STOXX600 added 0.1%, Germany’s DAX lifted 0.56%, and the French CAC rose 0.58%. In the UK, the FTSE100 fell 0.78% as the sterling rose on the back of a smaller-than-expected contraction in Britain’s economy in data out on Friday.
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