US: Stocks rally ahead of January inflation data
Add BT as a preferred source
WALL Street stocks won solid gains on Monday (Feb 13) in an optimistic round of trading, ahead of key inflation data that will influence US monetary policy.
Market watchers awaiting Tuesday’s consumer price index report have pencilled in further moderation, which would ease pressure on the Federal Reserve to prolong interest rate hikes for significantly longer.
The yield on the 10-year US Treasury dipped in a sign traders expect the Fed’s rate-hiking streak to end relatively soon.
“It looks as if the market is expecting a little bit of good news on inflation,” said Peter Cardillo of Spartan Capital Securities.
The Dow Jones Industrial Average finished up 1.1 per cent at 34,245.93.
The broad-based S&P 500 also climbed 1.1 per cent to 4,137.29, while the tech-rich Nasdaq Composite Index jumped 1.5 per cent to 11,891.79.
Navigate Asia in
a new global order
Get the insights delivered to your inbox.
Despite Monday’s gains, some analysts expressed caution ahead of Tuesday’s data.
Stocks were buffeted much of last week by worries that the Fed will enact many more interest rate hikes.
“Pricing pressures are expected to rise last month and we should not be surprised if the Valentine’s day inflation report is very hot as used car prices and energy costs clearly rebounded last month,” said Oanda’s Edward Moya.
“Risky assets could struggle if the bond market sees more traders place bets for much more Fed tightening,” he added.
Other economic releases this week include a report on retail sales on Wednesday and housing starts on Thursday, both for January. AFP
Decoding Asia newsletter: your guide to navigating Asia in a new global order. Sign up here to get Decoding Asia newsletter. Delivered to your inbox. Free.
Share with us your feedback on BT's products and services
