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Stocks rise as Fed rates look to weaken dollar

Stocks rally as Fed rate hopes dent dollar © Reuters. FILE PHOTO: People walk past an electronic board displaying Japan’s Nikkei average in Tokyo, Japan, September 14, 2022. REUTERS/Issei Kato

Herbert Rush and Hugh Jones

NEW YORK/LONDON (Reuters) – Global stocks rose for a second day on Friday on hopes that cooling U.S. inflation will keep the Federal Reserve from The prospect of aggressive rate hikes then pushed the dollar to its biggest two-day drop in nearly 14 years.

Cryptocurrency exchange FTX files for U.S. bankruptcy, founder Sam Bankman-Fried resigns as CEO while health authorities in China, the world’s largest crude oil importer, relax Oil prices surged after some of the country’s heavy COVID-19 restrictions.

Gold rose to a near three-month high after a better-than-expected U.S. consumer price report, And posted its best weekly performance since at least July 2020. Stocks mostly rose on Wall Street, adding to their biggest one-day percentage gains the previous day and Nasdaq, its biggest gain in the past 2-1/2 years. Annual inflation fell below 8% for the first time in eight months in October.

“We have an underlying perception that the Fed may not need to be as dire as we thought it would be over the past few weeks,” Marvin Loh, senior global macro strategist STATE STREET (NYSE:) IN Boston, speaking of booming markets. “The risks here are likely to stabilize.”

The Fed has no choice but to keep the pressure on, but if inflation stops rising, it would suggest further tightening could end nearby , Loh said.

fell 0.05%, but the S&P 500 gained 0.72% to gain 1.46%.

The MSCI World All World Index rose 1.77% to its highest level since mid-September, as markets repriced expectations for the Fed’s target rate to be below 5%, That is about 20 basis points below recent highs.

The MSCI Emerging Markets Index rose 5.3%, its biggest one-day gain since March 2020.

Market bets have increased that the Fed will raise rates by 50 basis points at its next meeting in December, while the odds of a 75 basis point hike have decreased.

“While this year has been exciting and fascinating from a market perspective, perhaps its culmination was really yesterday,” said Christian Chan, chief investment officer at AssetMark Financial Holdings (NYSE:) Inc.

‘s nt official CPI report shows that when “you take the number off and it keeps getting better,” Chan said, but with The labor market and corporate profit margins will come under pressure as the Fed works to lower inflation, creating potential headwinds for risky assets.

In Europe, yields have strengthened in the euro area, with the European Commission, the European Commission, saying it expects a sharper slowdown in the euro area in 2023, but it will only hurt jobs or jobs. There is a slight impact on public finances.

UK economy shrinks in three months to September

Multi-asset by asset manager Amundi John O’Toole, global head of investment solutions, said the stock market’s reaction to the recession CPI shows investors are “very desperate” for good news and may be getting ahead of themselves.

Interest rates could “stay high for an extended period of time, and that’s financial markets just don’t have the outlook for them,” O’Toole said. Add to.

US Inflation, Fed Rates and Markets

The dollar fell 1.6% on the day as investors piled into risk assets after the U.S. data.

The yield on the benchmark U.S. 10-year note fell below 4% on Thursday. U.S. bond markets were closed Friday for Veterans Day.

Asian stocks hit a seven-week high, MSCI’s broadest index of Asia-Pacific shares outside Japan hit a new all-time high as the percentage jumped one day since March 2020.

In China, health authorities on Friday eased the country’s strict COVID restrictions, including shortening the quarantine period for close contacts by two days. Cases and incoming passengers. China’s blue-chip CSI 300 index rose 2.8 percent, after surging 7.7 percent.

Oil prices rose after U.S. inflation data but were on track for a weekly drop of more than 4% due to China-related COVID-related concerns. [O/R]

futures settled up $2.49 at $88.96 a barrel, while up $2.32 at $95.99.

This week’s turmoil in the cryptocurrency market sent Bitcoin to a two-year low. Bitcoin fell 5.01% to $16,671.00 following the FTX announcement.

FTX’s native token, FTT, plunged 26.13% to $2.753, down 90% so far this month.



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