AP and AFP
LONDON/HONG KONG–World stock markets were mixed on Friday ahead of a speech by Fed Chairman Ben Bernanke that investors hope will show the central bank is still considering new stimulus for the U.S. economy.
In morning trading in Europe, Germany’s DAX was up 0.6 percent at 6,933.99 while France’s CAC-40 added 0.6 percent to 3,399.90. London’s FTSE 100 rose 0.3 percent to 5,734.35.
Wall Street appeared headed for gains, with Dow Jones industrial futures rising 0.3 percent to 13,023. The broader S&P 500 futures added 0.4 percent to 1,402.20. Asian indexes, however, closed mostly lower.
Bernanke will deliver his speech on Friday at a global gathering of central bankers in Jackson Hole, Wyoming. Hopes for further stimulus action took a blow this week when the Fed’s “Beige Book” survey of economic sentiment was fairly positive. Traders will look to Bernanke to clarify the Fed’s position.
“The Federal Reserve symposium at Jackson Hole is widely expected to disappoint,” said DBS Group in a report. “The Fed has scope to continue its wait-and-see approach, and keep open the door for action if needed.”
Europe’s debt crisis will also remain a key driver of market sentiment in coming weeks.
The latest official data showed unemployment in the 17-country eurozone remained at a record high of 11.3 percent in July, a sign the economy continues to suffer amid government spending cuts and financial uncertainty.
To help solve the crisis, the European Central Bank will next Thursday present more details on a plan to buy government bonds to drive down the borrowing rates for some countries, like Spain and Italy. Germany’s central bank remains opposed to the plan, but investors expect some deal to emerge by next week.
On Thursday, Chinese Premier Wen Jiabao, who usually avoids pointed comments about other governments, expressed alarm about Europe’s debt problems and called on Greece, Spain and Italy to embrace budget cuts and other reforms.
Inspectors from the so-called troika of the European Union, the European Central Bank and the International Monetary Fund are due in Athens next month for a financial review on which hinges a rescue loan installment of 31 billion euros.