Stocks buoyed by Wall Street ahead of US inflation update
By Huw Jones
LONDON (Reuters) — Wall Street headed for further gains on Friday after scaling new heights this week as looming U.S. inflation data will help investors calibrate how much further they may need to dial back on their rate cut bets.
The greenback was firmer and headed for a fourth weekly rise on Friday, pushing the yen to a 10-week low, as traders dialled back bets on how quickly the Bank of Japan might raise interest rates and how soon the Federal Reserve will cut them, helping to send gold lower for the week.
Oil ticked lower, though remained on track for weekly gains of about 5% with the market watching events in the Middle East after Israel rejected a ceasefire offer from Hamas.
The MSCI All Country stock index was slightly firmer, up 2.5% for the year so far.
The mood in stock markets was buoyed by Wall Street, where the S&P 500 index rose above 5,000 points for the first time ever on Thursday, capping a 21% surge since October.
Investors will now focus on the U.S. Bureau of LaborStatistics' revised inflation figures for 2023 at 1330 GMT, calculated using new seasonal adjustment factors — statistical weights that aim to reflect how prices behaved over the year more accurately. «This is something the Fed are watching, and Governor Wallerexplicitly mentioned these revisions in his speech last month,so it'll be an important one for the timing of any rate cuts,»said Deutsche Bank strategist Jim Reid.
U.S. inflation data for January is also coming next week. Dow, S&P 500 and Nasdaq stock index futures were all firmer. In Europe, the STOXX index of 600 companies was up 0.2%
Stocks were underpinned by a rethink of last year's narrative that the chances of a soft landing for the economy in 2024 were limited,
Read more on investing.com
