December 6, 2022

Global stocks rise amid relief after Fed meeting minutes

Global stocks rise amid relief after Fed meeting minutes

NEW YORK (Reuters) – Global stock markets rose broadly on Thursday and bond yields fell as upbeat surprises from the minutes of the latest US Federal Reserve meeting did not help allay immediate concerns about the impact of higher interest rates on economic growth.

Wall Street extended its rally from Wednesday. By mid-morning, all three major US stock indexes were up more than 1%, with consumer discretion driving the S&P 500 sectors higher.

MSCI Global Equity Standard (.MIWD00000PUS) It was up 1.15% at 10:45 AM ET (1445 GMT). stokes 600 pan europe (.stoxx) The benchmark stock index rose 0.74%, while the calmer mood saw MSCI’s broadest index of Asia-Pacific shares outside Japan. (MIAPJ0000PUS.) 0.01% fall.

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Dow Jones Industrial Average (.DJI) It rose 460.25 points, or 1.43%. Standard & Poor’s 500 (.SPX) Gained 59.69 points or 1.50%. And the Nasdaq (nineteenth) He added 196.69 points, or 1.72%.

The minutes of the Federal Reserve’s May meeting, released on Wednesday, showed a 50 basis point hike in interest rates in both June and July to combat inflation, easing investor fears that aggressive moves by the Fed could trigger a recession.

“US stocks are rising as investors viewed the Fed meeting minutes as only a gradual (tightening) policy commitment to fight inflation and after a few retailers gave an optimistic outlook,” said Edward Moya, an analyst at OANDA.

This positive sentiment was fragile, as policy makers appeared to leave themselves room to take more aggressive steps if inflation continues at its current levels.

“The Fed committed itself to delivering rate increases of half a point up to the Jackson Hole symposium, and this removed the risks of violent tightening in the short term,” Moya said.

Data on Thursday showed that the number of Americans filing new claims for unemployment benefits fell more than expected last week as the labor market remained tight, while a separate report confirmed that the US economy contracted in the first quarter. Read more

In Asia, the Chinese have potato chips (.CSI300) It reversed earlier losses to rise 0.25% after struggling to find direction for most of the session, as investors were concerned about signs of slowing but took comfort in Premier Li Keqiang’s comments about stabilizing the faltering economy.

South Korea’s central bank raised interest rates for the second consecutive meeting as it grapples with consumer inflation at a 13-year high. Read more

In foreign exchange markets, the dollar fell closer to a one-month low hit on Tuesday. The dollar index, which measures the price of the US unit against a basket of its major peers, was down 0.088%, with the euro advancing 0.26% to $1.0708.

US Treasury yields fell. The 10-year yield fell to its lowest level since April, last falling to 2.7505%.

Crude oil continued its cautious rally amid signs of tight supply, with US crude up 3.35% to $114.03 a barrel, and Brent crude up 2.59% to $116.98 a barrel.

Gold prices fell on Thursday as the Federal Reserve’s meeting minutes downplayed the metal’s allure as a safe asset.

Spot gold was down 0.2% at $1,848.99 an ounce by 10:04 AM ET (1404 GMT). US gold futures were also down 0.28% to $1,841.10.

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Additional reporting by Elizabeth Dilts Marshall, Danilo Masoni and Andrew Galbraith; Additional reporting by Vidya Ranganathan; Editing by Emilia Sithole Mataris and Jonathan Otis

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