NEW YORK/LONDON, Feb 13 (Reuters) – Wall Street shares were gaining ground on Monday while U.S. Treasury yields fell from an almost six-week high as investors bet that key U.S. economic data due out on Tuesday would show easing inflation.
The U.S. Bureau of Labor Statistics is scheduled on Tuesday to release January’s Consumer Price Index (CPI) data, expected to show how effective Federal Reserve policy tightening has been in taming inflation so far.
While U.S. equities lost some ground last week, they had rallied over the first weeks of 2023, buoyed by the prospect of a slowing in inflation, which could allow the Federal Reserve to slow or pause rate hikes.
“Investors are positioning themselves ahead of what they believe will be a favorable inflation report which could trigger an upward move in equity prices,” said Sam Stovall, chief investment strategist at CFRA Research in New York.
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A decline in gold and oil prices also reflects expectations for an easing of inflationary pressures, according to Stovall.
The Dow Jones Industrial Average (.DJI) rose 292.39 points, or 0.86%, to 34,161.66, the S&P 500 (.SPX) gained 38.13 points, or 0.93%, to 4,128.59 and the Nasdaq Composite (.IXIC) added 156.83 points, or 1.34%, to 11,874.95.
The pan-European STOXX 600 index (.STOXX) rose 0.90% and MSCI’s gauge of stocks across the globe (.MIWD00000PUS) gained 0.72%.
The MSCI All-World index (.MIWD00000PUS), after rising more than 8% in the first five weeks of 2023, fell 1.3% last week.
Emerging market stocks (.MSCIEF) rose 0.06% on Monday. Earlier, MSCI’s broadest index of Asia-Pacific shares outside Japan (.MIAPJ0000PUS) closed 0.19% lower, while Japan’s Nikkei (.N225) lost 0.88%.
In U.S. Treasuries, benchmark 10-year yields turned lower after earlier hitting their highest level since early January.
Benchmark 10-year notes were down 1.7 basis points to 3.726%, from 3.743% late on Friday. The 30-year bond was last down 3 basis points to yield 3.796%, from 3.826%. The 2-year note was last was up 3 basis points to yield 4.5428%, from 4.513%.
After rising earlier, the dollar
fell against a basket of major currencies.
However, the greenback rose to a one-week high against the rate-sensitive Japanese yen in choppy trading on bets that the Fed would keep monetary policy tight for longer.
Also sources had said on Friday that former Bank of Japan board member Kazuo Ueda is set to become the next governor. In an interview the same day, Ueda said it was appropriate for the BOJ to maintain its current ultra-easy policy.
The dollar index fell 0.212%, with the euro up 0.38% to $1.0716.
The Japanese yen weakened 1.01% versus the greenback at 132.77 per dollar, while Sterling was last trading at $1.2129, up 0.59% on the day.
Oil prices slipped on Monday as investors appeared to be focused on short-term demand concerns, also with an eye on Tuesday’s inflation data.
U.S. crude recently fell 0.2% to $79.56 per barrel and Brent was at $86.15, down 0.28% on the day.
Spot gold dropped 0.6% to $1,853.92 an ounce. U.S. gold futures fell 0.53% to $1,853.00 an ounce.
Reporting by Sinéad Carew, Amanda Cooper and Wayne Cole;
Editing by Mark Potter, Will Dunham and David Holmes
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