Global Markets: Shares rise, U.S. Treasury yields drop as Fed minutes suggest slower rate hikes

Twamev Construction and Infrastructure

23/11/2022 20:29

* 
      Fed minutes signal slower rate hikes
    

        * 
      Wall Street stocks trade higher
    

        * 
      U.S. Treasury yields retreat
    

        * 
      Crude prices drop more than 3%
    

        * 
      U.S. dollar falls
    

        * 
      Safe-haven gold climbs
    

  
 (New throughout, updates prices after Fed minutes)
    By Chibuike Oguh
       NEW YORK, Nov 23 (Reuters) - World equities rose while
U.S. Treasury yields retreated after minutes of the Federal
Reserve's latest policy meeting showed U.S. central bankers
looking to soon moderate the pace of interest rate hikes.
        A "substantial majority" of 
    Fed policymakers agreed it would "likely soon be
appropriate"
     to slow the pace of interest rate hikes, the meeting
minutes showed.
  
   Traders had expected the Fed minutes would affirm officials'
softening stance after recent data showed a moderation in
economic conditions.
    On Wednesday, U.S. Labor Department data showed jobless
claims increased more than expected last week. U.S. business
activity contracted for a fifth month in November, according to
the S&P Global flash U.S. Composite PMI Output Index.
   "I didn't really think there was any surprises. They seem to
still be pointing out that the risk to inflation are still high
and recent data has been more persistent than they thought,"
said Jordan Kahn, chief investment officer at ACM Funds in Los
Angeles, California.
       "People are going to get excited when they saw that some
participants who were mentioning the need to slow the pace of
rate hikes. But the market was already pricing in a 50 basis
point rate hike for December and the odds in the Fed futures
market of a 50-basis point hike was already 70% going into this
minutes," he said.
  
       The MSCI All Country stock index   .MIWD00000PUS  was up
0.85%, while European shares  .STOXX  rose 0.6%.
  
       U.S. Treasury yields traded lower after the Fed minutes.
Benchmark 10-year notes  US10YT=RR  were down to 3.713% while
the yields on two-year notes  US2YT=RR  dropped to 4.4876%.
  
        The yield curve that compares these two bonds
 US2US10=TWEB  was still in negative territory, at -76.30 basis
points. When inverted, that part of the curve is seen as an
indicator of an upcoming recession.
  
       "The Fed has been hiking rates at 75 basis points and it
was just unrealistic for them to continue at that pace," Kahn
added.
  
       On Wall Street, all three major indexes were trading
higher, led by gains in technology, consumer discretionary,
communication, healthcare and industrial stocks.
  
       The Dow Jones Industrial Average  .DJI  rose 0.37% to
34,225.33, the S&P 500  .SPX  gained 0.64% to 4,029.26 and the
Nasdaq Composite  .IXIC  added 1.08% to 11,294.92.
  
        Oil prices fell more than 3%, continuing a streak of
volatile trading, as the Group of Seven (G7) nations considered
a price cap on Russian oil above the current market level and as
gasoline inventories in the United States built by more than
analysts' expected.
       Brent  LCOc1  futures for January delivery fell 3.63% to
$85.15 a barrel, while U.S. crude  CLc1  fell 3.8%, to $77.82
per barrel
  
       The U.S. dollar fell across the board after the Fed
minutes. The dollar index  =USD  fell 0.924%, with the euro
 EUR=  up 0.9% to $1.0395.
  
       Gold prices climbed as the U.S. dollar fell. Spot gold
 XAU=  added 0.7% to $1,751.84 an ounce, while U.S. gold futures
 GCc1  gained 0.29% to $1,743.30 an ounce.    
  
    <^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
World FX rates YTD    http://tmsnrt.rs/2egbfVh
Global asset performance    http://tmsnrt.rs/2yaDPgn
Asian stock markets    https://tmsnrt.rs/2zpUAr4
Central banks ramp up fight against inflation    https://tmsnrt.rs/3iam1hy
    ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>
 (Reporting by Chibuike Oguh in New York; Editing by Bernadette
Baum and David Gregorio)
 ((Chibuike.Oguh@thomsonreuters.com; +332-219-1834; Reuters
Messaging: chibuike.oguh.thomsonreuters.com@reuters.net))
 
((To read Reuters Markets and Finance news, click on 
https://www.reuters.com/finance/markets))