Texas markets

Stocks rise, bonds fluctuate after Fed decision: market closure

This content was published on May 4, 2022 – 6:29 PM

(Bloomberg) – Stocks rose and Treasuries fluctuated as traders awaited more hints from Federal Reserve Chairman Jerome Powell on how aggressively the central bank will tackle inflation after making the biggest rate hike since 2000.

The key for the markets will be whether his commentary contains any hawkish surprises that could fuel concerns about an economic slowdown. He will hold his first in-person press conference in two years at 2:30 p.m. in Washington.

“The FOMC today took its first significant step towards correcting its inflation, and that should be welcomed by investors rather than feared,” said Seema Shah, chief strategist, Principal Global Investors.

JPMorgan Chase & Co. chief Jamie Dimon said the US central bank should have raised rates sooner as price pressures hit the global economy. Treasury Secretary Janet Yellen sees a possible ‘soft landing’ as the Fed attempts to reduce inflation. “I believe we’re going to see solid growth in the year ahead,” she said in an interview at a Wall Street Journal event on Wednesday.

Company Highlights:

  • Lyft Inc. and Uber Technologies Inc. released quarterly results that indicated strong demand for rides, but failed to reassure Wall Street that a driver shortage that has cost companies hundreds of millions of dollars in premiums decreased.
  • Moderna Inc. reported revenue above expectations, but said its 2022 Covid vaccine purchase orders were unchanged from what it announced three months ago.
  • Marriott International Inc.’s earnings beat expectations as avid vacationers hiked room rates, accelerating the recovery in lodging.

Key events this week:

  • Bank of England rate decision and briefing Thursday
  • OPEC+ meets virtually for regular meeting on Thursday
  • U.S. April Jobs Report, Friday

Some of the major movements in the markets:

Shares

  • The S&P 500 rose 0.6% at 2:28 p.m. PT
  • The Nasdaq 100 rose 0.3%
  • The Dow Jones Industrial Average rose 0.8%
  • The MSCI World index rose 0.1%

Currencies

  • The Bloomberg Dollar Spot Index fell 0.2%
  • The euro rose 0.3% to $1.0555
  • The pound was little changed at $1.2508
  • The Japanese yen rose 0.2% to 129.85 per dollar

Obligations

  • The 10-year Treasury yield was little changed at 2.97%
  • Germany’s 10-year yield was little changed at 0.97%
  • The UK 10-year yield was little changed at 1.97%

Merchandise

  • West Texas Intermediate crude rose 5.3% to $107.85 a barrel
  • Gold futures rose 0.2% to $1,874.90 an ounce

©2022 Bloomberg LP