After last week’s turmoil, global markets are making a positive start to this one.
Asian stocks rose modestly on Monday. The Shanghai Composite index added 0.8% and Hong Kong’s Hang Seng was up around 0.1% in afternoon trading. Dow futures also climbed, gaining 0.7% at 2:45 a.m. ET.
But some markets still struggled. Australia’s benchmark index slid 0.3%.
Last week was rough for stock investors around the world.
Major indexes in Asia took especially heavy hits, with Hong Kong and Shanghai plunging nearly 10% over five days of rocky trading.
European markets also suffered. Stock averages in London, Frankfurt and Paris fell around 5%.
The losses in Europe were similar to those in the U.S. where the Dow and the S&P sank about 5%, marking their worst weekly decline since 2016.
Although the steep drops and volatile trading evoked memories of the scary days of the financial crisis in 2008, the market and economy are now in vastly better shape. Unemployment is at its lowest in 17 years, and the banking system has mostly healed.
But a recent piece of good economic news — a pickup in wage growth in the U.S. — has unsettled investors, raising questions about what the U.S. Federal Reserve will do next.
If inflation accelerates, driven in part by higher wages, the Fed could raise interest rates more often and more steeply than previously anticipated. Higher rates would increase the cost of borrowing, potentially eating into companies’ profits and making their stock less attractive.
But some analysts say the worries are overdone, suggesting the strong economy means the stock market will eventually bounce back from its recent slump.
— Matt Egan, Alanna Petroff and David Goldman contributed to this report.