(Bloomberg) — U.S. futures rose slightly after long-awaited economic data highlighted a slowing economy and boosted bets on further interest rate cuts by the Federal Reserve.
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Contracts on the S&P 500 rose 0.1% after the underlying index reached its 42nd highest closing level this year. The dollar and 10-year US Treasury yields fell.
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The Fed’s preferred measure of core inflation in the United States rose slightly in August. The core index, which excludes volatile food and energy prices, rose 0.1% from July. It rose 2.7% from last year, in line with estimates. Consumer spending, adjusted for inflation, rose 0.1%.
“Add today’s PCE price index to the list of economic data that has hit a sweet spot,” said Chris Larkin, managing director of trading and investing at E*Trade. “Inflation continues to keep its head low, and while economic growth may be slowing, there is no sign of it falling off a cliff.”
Daily stimulus announcements in China, coupled with rising bets on deeper interest rate cuts from the Federal Reserve and European Central Bank, have also increased risk appetite in markets this week.
“The data points to a soft landing – you have to respect the data – but forward-looking indicators point to warning signs,” said Andrew Pease, global head of investment strategy at Russell Investments Ltd. Same as the beginning of the recession. You won’t know until you get there.”
The Japanese yen rebounded after Shigeru Ishiba won the vote to lead the country’s ruling party. Ishiba, a party veteran who has served in several senior positions including defense minister, is seen as supportive of the Bank of Japan’s plan to gradually raise interest rates.
The European Stoxx 600 index rose, on track for its best weekly performance since May after pledges of support from China’s leaders sent luxury goods and mining stocks exposed to the country’s economy higher.
German bond yields and the euro fell as inflation numbers in both Spain and France appeared lower than expected, fueling expectations of more decisive interest rate cuts by the European Central Bank.
European bonds rally builds momentum as bets grow on October cut
Trading madness
In China, the CSI 300 index concluded its best week since 2008. The People’s Bank of China unleashed one of the country’s boldest policy campaigns in decades, with Beijing rolling out an aggressive stimulus package in an attempt to support the slowing economy and boost the economy. Investor confidence.
In other commodity markets, oil prices stabilized after a sharp decline over two days, with prices continuing on course for a significant weekly decline amid expectations of increased supplies from OPEC members Saudi Arabia and Libya.
Gold is headed for a third weekly gain after hitting successive record highs amid optimism that the Federal Reserve will maintain an aggressive pace of interest rate cuts this year.
Some key movements in the markets:
Stocks
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S&P 500 futures rose 0.2% as of 8:46 a.m. New York time
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Nasdaq 100 futures rose 0.2%
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Dow Jones Industrial Average futures rose 0.2%
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The Stoxx Europe 600 index rose 0.4%.
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MSCI World Index rose 0.3%
Currencies
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The Bloomberg Dollar Spot Index fell 0.3%.
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There was little change in the euro at $1.1183
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There was little change in the pound sterling at $1.3422
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The Japanese yen rose 1.4% to 142.82 yen to the dollar
Cryptocurrencies
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Bitcoin rose 1.8% to $65,834.82
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Ethereum rose 1.2% to $2,664.36
Bonds
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The yield on the 10-year Treasury note fell four basis points to 3.76%.
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The yield on 10-year German bonds fell by five basis points to 2.14%.
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The yield on British 10-year bonds fell four basis points to 3.97%.
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This story was produced with assistance from Bloomberg Automation.
–With assistance from Winnie Hsu, Divya Patel, Alex Nicholson, and Sujata Rao.
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