U.S. stocks rose as investors awaited the release of policy minutes from the Federal Reserve’s last meeting for potential signs that interest rate hikes may slow.
The S&P 500 rose on Tuesday after closing at its highest level since mid-September. The Nasdaq 100 jumped after a wobbly start to the session.
Market trading volumes are expected to be lighter on Thursday given the US Thanksgiving holiday.
A gauge of dollar strength eased on Wednesday after data showed U.S. jobless claims rose more than expected to a three-month high, a sign of a cooling labor market. Treasuries rose after a weaker-than-expected purchasing managers’ index reading for November.
Another set of data on Wednesday showed that capital spending plans are holding back in the face of higher borrowing costs and broader economic uncertainty. While the EU was debating the application of a price limit of 65-70 dollars per barrel to Russian oil, oil fell.
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The Fed’s Nov. 1-2 minutes release — at 2 p.m. in Washington — will look at how policymakers combined to push higher for interest rates than previously hinted at in the fight against inflation. However, after that meeting, investors struggled with economic data that somewhat eased inflation concerns.
Some investors believe the lower-than-expected inflation numbers could prompt the Fed to ease the scale of rate hikes at next month’s meeting.
“Investors are looking for clues that they are acting prematurely, or that there is more support for such a slowdown in tightening and less for a higher terminal rate than they previously thought,” said Craig Erlam, chief market analyst at Oanda. Europe Ltd.
European investors digested data showing that private sector activity in the eurozone’s two leading economies, Germany and France, slowed in November, painting a bleak picture for a region that may already be in recession.
A separate survey found that the UK economy is in recession and the recession is expected to worsen by 2023.
Meanwhile, a gauge of euro-zone activity in manufacturing and services rose unexpectedly in November, suggesting businesses saw early signs that the region’s economic slowdown may be easing, with record inflation cooling and expectations for future output improving.
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