(Bloomberg) — Stocks rose as remarks from Federal Reserve officials bolstered bets officials will refrain from lifting rates this year. Oil climbed after Hamas’ attack on Israel raised fears of a wider conflict.
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The S&P 500 erased losses as Fed Vice Chair Philip Jefferson said officials are in a position to “proceed carefully” after the recent rise in Treasury yields. Earlier in the day, Fed Bank of Dallas President Lorie Logan said the recent surge in long-term US bond rates may mean less need for the central bank to tighten again. The dollar edged lower. Treasury futures climbed, with the cash market closed for Columbus Day.
“The script has changed,” said Andrew Brenner at NatAlliance Securities. “The odds for another tightening have dropped dramatically since Friday.”
At the end of last week, traders had boosted bets on another Fed hike this year as data showed US employment unexpectedly surged in September.
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Energy companies led gains in the S&P 500 as US crude futures briefly topped $87 a barrel. Exxon Mobil Corp. and Chevron Corp. added over 2.7%. Defense companies rallied, with Northrop Grumman Corp. up the most since March 2020 and Lockheed Martin Corp. gaining 8.9%. American Airlines Group Inc. and Delta Air Lines Inc. fell more than 4%.
Israeli companies Teva Pharmaceutical Industries Ltd. and Check Point Software Technologies Ltd. slipped in US trading. The shekel dropped even after the central bank unveiled a $45 billion support program. Gas prices in Europe soared.
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The latest Middle East conflict comes at a time of ongoing geopolitical concerns, with markets also facing a period of moderating global economic growth, according to Solita Marcelli, chief investment officer Americas at UBS Global Wealth Management
“Against this backdrop, we continue to prefer fixed income to…
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