August 10, 2022

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Stocks Rise, Copper Extends Fall As Investors Assess Recession Risk

Stocks Rise, Copper Extends Fall As Investors Assess Recession Risk

  • US stocks are on a sharp rise early
  • Copper is down again, and oil is up
  • Treasury yields are higher

NEW YORK (Reuters) – Stocks jumped in global markets on Friday, with Wall Street rising more than 2% and the MSCI World Index poised for weekly gains after three straight weeks of declines, as lower commodity prices eased concerns about inflation. .

US Treasury yields rose but held above two-week lows.

Investors were concerned that large interest rate increases by the Federal Reserve and other major central banks to combat inflation could cause a recession, which could reduce demand for goods and other items.

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Copper prices are set for their biggest weekly drop in a year, with benchmark copper on the London Metal Exchange down 1.4% to $8,290 a ton on Friday. Read more as other industrial minerals declined.

Oil prices rose on Friday after a sharp drop this week. Read more

“The (stock) market went oversold this week, so it’s time to bounce back,” said Quincy Crosby, chief equity strategist at LPL Financial in Charlotte, North Carolina.

“We have seen oil prices drop along with the prices of other commodities,” she said, adding that the market’s move reflects “expectations of at least a marked slowdown if not an intermittent recession.”

Last week, the S&P 500 confirmed the existence of a bear market.

In US Treasuries, yields have fallen from their highest levels in more than a decade before the Federal Reserve meeting last week. The US central bank raised interest rates by 75 basis points at the meeting.

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Fed fund futures traders lowered their expectations on how high the likelihood of the Federal Reserve raising its benchmark rate. They are now aiming for the rate to rise to 3.49% by March, down from expectations last week that it will rise to around 4%. It is currently 1.58%. And the

Dow Jones Industrial Average (.DJI) The Standard & Poor’s 500 Index rose 656.17 points, or 2.14%, to 3,1333.53 points (.SPX) It rose 86.74 points, or 2.29%, to 3,882.47 points, and the Nasdaq Composite (nineteenth) It added 234.04 points, or 2.08%, to 11,466.23 points.

Pan-European STOXX 600 Index (.stoxx) It rose 2.62% and the MSCI gauge of stocks worldwide (.MIWD00000PUS) Gained 2.16%.

US crude recently rose 3.39% to $107.80 a barrel, and Brent crude reached $113.40, up 3.04% on the day.

In the foreign exchange market, the dollar index fell 0.297%, with the euro advancing 0.27% to $1.0551.

The Japanese yen was down 0.08% against the dollar at 135.04 per dollar.

The stricken yen stabilized this week. Japanese inflation topped the Bank of Japan’s 2% target for the second month in a row, adding to pressure on its ultra-easy stance on policy. Read more

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Reporting by Caroline Valitkevich. Additional reporting by Caroline Cohn in London and Brijesh Patel in Bengaluru. Editing by Andrew Heavens and David Gregorio

Our criteria: Thomson Reuters Trust Principles.