Most Markets Track Wall St Gains After US Inflation Data

Most markets rose Monday and gold hit a record high following US inflation figures that met expectations and soothed concerns about Donald Trump's latest tariff salvo.

However, investors were keeping a wary eye on Washington, where lawmakers have failed to reach a funding compromise to keep the government running, which observers say could affect the release of key data.

All three main indexes in New York ended in the green Friday, snapping three straight losses following news that the Federal Reserve's preferred gauge of inflation rose in line with expectations, giving the bank room to cut interest rates again.

While the 2.7 percent reading on the August personal consumption expenditures (PCE) index was up from 2.6 percent in July and well above the Fed's two percent target, policymakers are focusing on supporting the labour market after a string of weak jobs readings.

Their cut earlier this month -- the first since December -- came as a closely watched guide indicated two more were in the pipeline before January.

The news helped investors look past the US president's announcement last week of 100 percent tariffs on pharmaceuticals, big-rig trucks, home renovation fixtures and furniture.

Attention now turns to the key non-farm payrolls (NFP) report due Friday.

However, there are concerns that could be postponed by a possible government shutdown this week as US politicians struggle to reach a funding deal, with some analysts suggesting the labour department could be hit.

With a deadline for a deal coming on Tuesday, congressional leaders on both sides are due to meet President Trump to try to resolve the issue, which could see some key services closed down.

Hakeem Jeffries, the Democratic House leader, said on ABC News that he was "hopeful" that a deal could be struck before the Tuesday cutoff.

His colleague Chuck Schumer, the Democrats' Senate leader, echoed that guarded optimism and said any potential breakthroughs would depend on Trump's Republicans.

Trump has struck a defiant tone in pushing for his own agenda and last week cancelled a meeting to discuss the stalemate with senior opposition leaders, which will instead take place Monday.

"If we hear early this week that the NFP report will be delayed (potentially until the govt re-opens), traders may recalibrate their approach to risk and increase their sensitivity to" other jobs figures, said Pepperstone's Chris Weston.

And economists at Bank of America warned that the longer the row went on the more painful it would be for the world's top economy.

"The economic effects of a shutdown are typically modest and short-lived. Though the drag grows with the length of the shutdown, and potential federal layoffs could have more lasting effects," they wrote.

Still, investors in most markets were in a positive mood, building on Wall Street's gains.

Hong Kong led the gainers thanks to a surge in Chinese tech giants including Alibaba, while Seoul rose more than one percent. Shanghai, Sydney, Singapore, Bangkok, Wellington and Jakarta also advanced.

London, Paris and Frankfurt opened on the front foot.

Tokyo slipped, though the finance arm of Sony soared more than 30 percent on its debut after being spun off by the tech titan to focus on its entertainment and image sensor business.

Sony Financial Group rocketed to as much as 210 yen in the morning, from the 150 yen reference point set last week. It later pared the gains to end at 173.80 yen.

Mumbai and Manila dropped.

Gold spiked to a fresh peak just short of $3,820 an ounce on concerns about the possible shutdown and on expectations for more rate cuts, which make the precious metal more attractive as an investment.

Oil prices sank on speculation OPEC+ will increase output, fanning concerns of a glut. The drop followed last week's rally on the back of mounting tensions between NATO countries and Russia, increasing the possibility of fresh sanctions on Moscow.

Tokyo - Nikkei 225: DOWN 0.7 percent at 45,043.75 (close)

Hong Kong - Hang Seng Index: UP 2.0 percent at 26,665.27

Shanghai - Composite: UP 0.9 percent at 3,862.53 (close)

London - FTSE 100: UP 0.3 percent at 9,309.58

Euro/dollar: UP at $1.1722 from $1.1701 on Friday

Pound/dollar: UP at $1.3439 from $1.3405

Dollar/yen: DOWN at 148.79 yen from 149.51 yen

Euro/pound: DOWN at 87.24 pence from 87.30 pence

West Texas Intermediate: DOWN 0.9 percent at $65.13 per barrel

Brent North Sea Crude: DOWN 0.7 percent at $69.62 per barrel

New York - Dow: UP 0.7 percent at 46,247.29 (close)