© Reuters. A man wearing a protective mask, amid the outbreak of the coronavirus disease (COVID-19), walks through an electronic board displaying charts (top) for the Nikkei index outside a brokerage in Tokyo, Japan, March 10, 2022. REUTERS/Kim Kyung-Hoon
Written by Elizabeth Dilts Marshall
NEW YORK (Reuters) – Global stocks rose on Thursday and the US dollar fell a day after minutes of the US Federal Reserve’s May meeting indicated the central bank would remain flexible and could hold off on raising interest rates later in the year.
Wall Street closed higher with the three major US indexes posting their biggest weekly gains since mid-March.
The benchmark MSCI global stock index was up 1.54% at 4:25 pm ET (2025 GMT). Europe’s benchmark stock index rose 0.78%, while MSCI’s broadest index of Asia-Pacific shares outside Japan was down 0.02%.
The DJI index rose 516.91 points, or 1.61%, to 32,637.19. .SPX rose 79.11 points, or 1.99%, to 4,057.84 points. The .IXIC index added 305.91 points, or 2.68%, to 11,740.65 points.
The three indices were on their way to snapping their longest streak in decades of weekly declines.
The minutes of the May meeting of the Federal Reserve, which was released on Wednesday, showed that the majority of Fed officials support a nice 50 basis point rate hike in both June and July.
Analysts at Bank of America (NYSE) said the Fed may halt its tightening in September if the economy deteriorates.
Thursday’s data showed that the number of Americans filing new claims for unemployment benefits fell more than expected last week as the labor market remained tight. A separate report confirmed the US economy contracted in the first quarter.
“The jobs data will really drive the Fed’s outlook going forward,” said Brian Overby, senior options analyst at Ally. “If they see that the unemployment rate is going up a little bit it could slow them down.”
The US dollar fell 0.284% against a basket of global currencies. If the Fed becomes less aggressive about tightening, it will weaken the dollar’s appeal as a safe haven.
The euro rose 0.44% to $1.0727.
US Treasury yields rose after the benchmark 10-year bond hit a six-week low, with signs of slowing economic growth easing inflation fears.
The yield rose to 2.7416% after falling to 2.706% early in the session.
“The 10-year Treasuries were at about 3% and are down. This is an indication that the market feels like the Fed is tackling the inflation problem,” said Clark Kendall, President and CEO of Kendall Capital.
In commodities, futures rose $3.37, or 3.0%, to settle at $117.40 a barrel, while US West Texas Intermediate crude rose $3.76, or 3.4%, to settle at $114.09.
It rose in the United States in the latest rise by 0.17% to 1,849.50 dollars.
In Asia, Chinese blue-chips reversed earlier losses to rise 0.25% after struggling to find direction for most of the session, as investors worried about signs of a slowdown but took comfort in Premier Li Keqiang’s comments about stabilizing the faltering economy.
South Korea’s central bank raised interest rates for the second consecutive meeting as it battles consumer inflation at its highest level in 13 years.