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THE GIST
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Archives: Reuters Articles

Australia shares set to inch lower; NZ index gains

Australia shares set to inch lower; NZ index gains

May 31 (Reuters) – Australian shares were expected to inch lower on Tuesday, after witnessing broad gains for two straight sessions, while global sentiment was lifted after further easing of COVID-19 curbs in China.

The local share price index futures YAPcm1 fell 0.2%, a 3.6-point discount to the underlying S&P/ASX 200 index .AXJO close. The benchmark rose 1.5% on Monday.

New Zealand’s benchmark S&P/NZX 50 index .NZ50 rose 0.3% by 2220 GMT.

(Reporting by Jaskiran Singh in Bengaluru)

((jaskiran.singh@thomsonreuters.com))

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Gold prices edge up as dollar slide lifts appeal

Gold prices edge up as dollar slide lifts appeal

May 30 (Reuters) – Gold prices held firm on Monday in mostly range-bound trade, helped by a dip in the dollar, while investors have dialled down their expectations of further aggressive monetary policy tightening in the United States.

Spot gold edged up 0.1% to USD 1,854.49 per ounce by 2:18 p.m. ET (1818 GMT). US gold futures rose 0.04 % to USD 1,858.00.

Gold prices are on course for a second straight monthly fall.

The dollar index hit a more than one-month low, making bullion less expensive for those holding other currencies. Meanwhile the benchmark 10-year note yields ended on Friday slightly above a six-week low.

“If economic fears further weigh on yields, gold could capitalise once more, with USD 1,870 being the first test and then USD 1,900,” said Craig Erlam, senior market analyst at OANDA.

“Sentiment in the markets remain extremely fragile but as long as focus is on the deterioration of the economic outlook rather than additional rate hikes being priced in, gold can continue to perform well.”

Investors now expect an eventual slowdown in the US monetary policy tightening after the Federal Reserve hikes interest rates in June and July.

However, the US Federal Reserve Governor Christopher Waller said on Monday that the Fed should be prepared to raise interest rates by a half percentage point at every meeting from now on until inflation is decisively curbed.

“Trading gold on a potential Fed pause more than a year on the horizon isn’t exactly an attractive proposition for money managers, particularly as quantitative tightening continues to sap liquidity from markets in the meantime,” analysts at TD Securities said in a note.

While gold is viewed as a hedge against higher inflation and safe store of value during political and financial uncertainties, higher rates raise the opportunity cost of holding non-yielding bullion.

Spot silver fell 0.6% to USD 21.96 per ounce, platinum rose 0.2% to USD 955.66 and palladium fell 1.2% to USD 2,038.03.

Federal government offices, stock and bond markets are closed on Monday for the Memorial Day holiday in the United States.

(Reporting by Eileen Soreng in Bengaluru; Editing by Alison Williams and Alistair Bell)

Thai, Vietnam rice price hike plan ‘impossible’, Thai export body says

Thai, Vietnam rice price hike plan ‘impossible’, Thai export body says

BANGKOK, May 30 (Reuters) – A pact between Thailand and Vietnam to raise rice prices would be “impossible”, a top Thai industry official said on Monday, amplifying opposition to a government-proposed plan for a rice cartel and questions over its viability.

Thailand’s government said on Friday it planned with Vietnam to create a pact between the world’s second- and third-largest rice exporters to boost their bargaining power and help mitigate rising production costs.

Vietnam has yet to confirm such a plan was being discussed.

Chookiat Ophaswongse, honorary president of Thailand’s Rice Exporters Association, said his body had not been consulted, and the idea was poorly thought out.

“Thailand and Vietnam are not the largest exporters, combined it’s less than India and would have buyers turn to competitors,” Chookiat told Reuters, adding rice cannot be stored for long enough while awaiting a climb in price.

“Politicians don’t understand the rice market and did not discuss this with the association,” he said.

His comments are similar to those of the head of Vietnam’s food association, who last week said raising prices at a time of global food uncertainty would be unreasonable.

Vietnam’s agriculture ministry did not immediately respond to Reuters requests for comment on Monday.

Alongkorn Ponlaboot, adviser to Thailand’s agriculture and cooperatives minister, told Reuters Vietnam “agrees in principle that increasing prices would benefit the two countries.”

“Whether this is successful, this cannot be answered because there needs to be more discussions,” he added.

CARTEL ‘UNLIKELY’

Top rice exporter India accounts for about 40% of global supply and its prices hit a five-year low last week on a weaker Indian rupee and abundant supply among top exporting countries. Officials said last week India had no plans to limit exports. nL2N2XJ04E

India’s 5-percent broken white rice is at least USD 50 per tonne cheaper than that of Vietnam and USD 100 cheaper than Thailand, dealers said on Monday. Vietnam has in recent years imported some Indian rice for use in beer and animal feed.

“Price mechanisms will not work without India’s participation. Indian rice is already far cheaper … If others raise prices, then it is natural for buyers to shift towards India,” said a Mumbai-based dealer with a global trading house.

The dealer said Vietnam and Thailand had lost market share and would need to lower prices to regain it.

A rice trader based in Ho Chi Minh City said a cartel was unlikely with “too many different views on this issue” and because neither country was the top exporter.

“If India curbs exports, prices will rise without Thailand and Vietnam having to form a cartel,” the trader said.

Vietnam and Thailand account for about 10% of global production of rough rice, and about 26% of global exports, according to the US Department of Agriculture.

One of the biggest losers from a cartel would be the world’s second-biggest rice importer, the Philippines, a big buyer of Thai and Vietnamese rice.

The Philippines’ record paddy output last year of 20 million tonnes is insufficient to feed its 110 million people.

Its agriculture department spokesperson Noel Reyes on Monday expressed confidence that technology could help production reach new highs and in “a more cost-effective manner” than Vietnam and Thailand.

(Reporting by Panarat Thepgumpanat in Bangkok, Rajendra Jadhav in Mumbai, Vu Khanh in Hanoi and Enrico dela Cruz in Manila; Writing by Chayut Setboonsarng; Editing by Jacqueline Wong and Bernadette Baum)

Oil climbs above $121 a barrel as China eases restrictions, EU meets

Oil climbs above $121 a barrel as China eases restrictions, EU meets

May 30 (Reuters) – Oil prices climbed above USD 121 a barrel on Monday, hitting a two-month high as China eased COVID-19 restrictions and traders priced in expectations that the European Union will eventually reach an agreement to ban Russian oil imports.

Trading activity was muted due to a public holiday in the United States.

The Brent crude futures contract for July, which will expire on Tuesday, settled up USD 2.24, or 1.9%, at USD 121.67 a barrel. US West Texas Intermediate (WTI) crude futures were up USD 1.99, or 1.7%, to USD 117.06 a barrel at 18.03 GMT, extending solid gains made last week.

“One reason being cited for this is the imminent lifting of coronavirus restrictions in Shanghai, which is sparking hopes that oil demand will pick up again in China,” analysts at Commerzbank said in a note to clients.

Shanghai announced an end to its two-month-long COVID-19 lockdown, and will allow the vast majority of people in China’s largest city to leave their homes and drive their cars from Wednesday.

Meanwhile, the EU is meeting on Monday and Tuesday to discuss a sixth package of sanctions against Russia for its invasion of Ukraine, which Moscow calls a “special military operation.”

“Europe has been haggling about this for the better part of a month, but increasingly the market is pricing (additional sanctions) in as a risk,” said Daniel Ghali, senior commodity strategist at TD Securities in Toronto.

EU countries failed to agree on a Russian oil import ban despite last-minute haggling before the summit got under way in Brussels. But leaders of the 27 EU countries will agree in principle to an oil embargo, a draft of their summit conclusions showed, while leaving the practical details and hard decisions until later.

Any further ban on Russian oil would tighten a crude market already strained for supply amid rising demand for gasoline, diesel and jet fuel ahead of the peak summer demand season in the United States and Europe.

Underscoring market tightness, the Organization of the Petroleum Exporting Countries and allies including Russia, a group dubbed OPEC+, are set to rebuff Western calls to speed up increases in output when they meet on Thursday.

They will stick to existing plans to raise their July output target by 432,000 barrels per day, six OPEC+ sources told Reuters.

(Additional reporting by Noah Browning in London, Sonali Paul in Melbourne and Koustav Samanta in Singapore; Editing by David Evans, David Holmes and Mark Porter)

Stock rally fanned by hopes of Fed ‘past peak hawkishness’

Stock rally fanned by hopes of Fed ‘past peak hawkishness’

NEW YORK, May 27 (Reuters) – Bad news may once again be good news on Wall Street, as signs of slowing US growth fan hopes that the Federal Reserve may not need to tighten policy as much as previously expected.

Home sales have fallen for a third straight month, while big misses from retail giants such as Target Corp. (TGT) and Walmart Inc. (WMT) shook their share prices last week. The Atlanta Fed’s GDPNow estimate of real GDP growth for the second quarter fell to 1.8% on May 25, from 2.4% the previous week.

Softer economic growth raises risks of weaker corporate profits, in theory paving the way for softer share prices. Several Wall Street banks have in recent weeks warned that the chances of a US recession are rising, along with an increased likelihood of the low-growth, high-inflation environment known as stagflation.

In the near-term, however, some investors believe a nascent slowdown could bolster the case for the Fed to pull back on an aggressive monetary policy tilt that has unnerved investors and helped drive the S&P 500 index to the cusp of the 20% decline that many call a bear market.

The index rose 6.6% this week, snapping a seven-week losing streak, though it is down around 13% for the year to date. Net weekly inflows to US stocks stood at their highest level in 10 weeks, data from BofA Global Research showed Thursday.

“It’s very clear that everyone at the Fed is on board for 50 basis-point (interest rate hikes) for the next two hiking meetings. But after that, it’s unclear what they do, and if there is a sharp slowdown in growth, they may be able to wait a little bit,” said Anwiti Bahuguna, senior portfolio manager and head of multi-asset strategy at Columbia Threadneedle Investments, who recently raised her allocation to equities.

Concerns over the impact of higher rates at a time when inflation may have peaked will likely mean the central bank will pause its tightening in September, leaving its benchmark overnight interest rate in a range of 1.75% to 2% if financial conditions worsen, BofA strategists said in a note.

Expectations of Fed hawkishness have eased, with investors now pricing in a 35% probability that the Fed funds rate will be between 2.25% and 2.50% after its September meeting, down from a 50% probability a week ago, according to CME.

The Fed has already raised rates by 75 basis points this year. Minutes from the central bank’s latest meeting showed officials grappling with how best to navigate the economy toward lower inflation without causing a recession or pushing the unemployment rate substantially higher.

Signs that growth may be slowing have helped bolster Treasury prices, suggesting investors are increasingly looking to bonds for safety rather than as assets that could be at risk during times of high inflation, said Anders Persson, chief investment officer of global fixed income at Nuveen.

Yields of benchmark 10-year Treasuries, which move inversely to prices, hit a six-week low of 2.706% on Thursday, after soaring to as high as 3.14% this month.

“The market is pricing in a slowdown,” but not a recession, Persson said, making riskier parts of the fixed-income market, such as high yield bonds, more attractive.

US data on Friday also showed price increases may be slowing. The personal consumption expenditures (PCE) price index rose 0.2%, the smallest gain since November 2020, after shooting up 0.9% in March.

A potentially less hawkish Fed is not necessarily a green light for equity buyers over the long term. With inflation at its highest in decades, concerns have grown over impending stagflation, a phenomenon that weighed heavily on all asset classes during the supply shocks of the 1970s.

Among those sounding the warning are hedge fund manager Bill Ackman, a member of the Fed’s investor advisory committee on financial markets, who on Twitter this week urged the central bank to quell inflation by raising rates more aggressively.

Meanwhile, Citi’s global asset allocation team this week cut its US equity allocation to “neutral,” saying, “While a US recession is not the base case for Citi economics, uncertainty is very high.”

Some investors, however, believe a turning point may be near.

Esty Dwek, chief investment officer at FlowBank, is betting the central bank will begin to see signs that inflation and growth are slowing by August, when policymakers hold their annual meeting in Jackson Hole, Wyoming.

“The Fed is past peak hawkishness,” she said.

(Reporting by David Randall in New York; Additional reporting by Lewis Krauskopf in New York; Editing by Ira Iosebashvili, Nick Zieminski and Matthew Lewis)

Dollar slides for second week as traders adjust Fed rate hike views

Dollar slides for second week as traders adjust Fed rate hike views

NEW YORK, May 27 (Reuters) – The dollar edged lower on Friday on its way to a second-straight weekly decline as traders pared expectations for US Federal Reserve interest rate hikes and as improving inflation and consumer spending data eased recession fears.

The dollar index =USD, which measures the safe-haven currency against a basket of six other major currencies, fell as low as 101.43, its weakest since April 25. On a weekly basis, it was down 1.24%, following a 1.45% decline the previous week. At 3:10 p.m. Eastern time (1910 GMT), the dollar was down 0.059% at 101.66.

“We continue to think that the best of the broader USD rally is behind us now and while the USD may not fall significantly yet, further gains seem unlikely,” strategists from Scotiabank said in a client note.

The “Fed is fully priced and expectations for rate hikes later in the year may be subject to revision if the economy slows more quickly than expected,” they said.

The greenback hit a nearly two-decade peak above 105 earlier this month but has declined along with outlooks for the magnitude of likely Fed rate hikes this year, which have been fueled in part by fears over runaway inflation.

“The dollar is losing altitude as the view of the Fed pausing rate hikes in the fall gains traction,” said Joe Manimbo, senior market analyst at Western Union Business Solutions.

Minutes from the Fed’s May meeting this week showed most participants believed 50 basis-point hikes would be appropriate at the June and July policy meetings, but many thought big, early hikes would allow room to pause later in the year to assess whether tighter policy is helping to tame inflation.

Although inflation continued to increase in April, it rose less than in recent months, data showed on Friday. The personal consumption expenditures (PCE) price index rose 0.2%, the smallest gain since November 2020, after shooting up 0.9% in March. For the 12 months through April, the PCE price index advanced 6.3% after jumping 6.6% in March.

Benchmark US Treasury yields were lower on Friday, but briefly bounced off session lows after the April inflation figures, which boosted hopes that the worst of soaring price pressures has passed.

A separate report showed US consumer spending rose more than expected last month as households boosted purchases of goods and services.

Next week’s key US report will be the nonfarm payrolls numbers for May at the end of the week.

“The jobs data will shed some light on the scope for tightening from the third-quarter forward,” said Manimbo.

The euro has been the chief beneficiary of the dollar’s decline, but that momentum has also stalled as investors believe much of the expected rate hikes from the European Central Bank have been priced into current levels.

The single currency was flat for the day at USD 1.0731, having earlier risen to its highest levels in a month. Sterling was 0.16% higher at USD 1.2628.

The risk-sensitive Australian dollar rallied 0.8% to USD 0.7156, while the New Zealand dollar jumped 0.88% to USD 0.6535.

Better risk sentiment did not help bitcoin, however, which was 2.59% lower at USD 28,426, continuing this week’s gradual decline from the psychologically important USD 30,000 level.

(Reporting by John McCrank; additional reporting by Saikat Chatterjee in London; editing by Susan Fenton, Kirsten Donovan and Jonathan Oatis)

Yields near six-week lows, Fed hawkishness in question

Yields near six-week lows, Fed hawkishness in question

NEW YORK, May 27 (Reuters) – US Treasury yields ended near six-week lows on Friday as concerns about growth and signs that inflation may have peaked led investors to speculate that the Federal Reserve may not raise rates as much as previously expected.

Benchmark 10-year yields have dropped from 3-1/2 year highs reached earlier this month on concerns that the US central bank’s aggressive rate hikes could tip the economy into recession.

Now, those fears have also increased speculation that the Fed could pivot to a more dovish stance if the economy cools.

“That’s been this week’s story … people questioning how high the terminal rate will ultimately be, but I think it’s still going to be too soon to say with any high conviction just given the fact that we’re going to need to see more inflation data,” said Benjamin Jeffery, interest rate strategist at BMO Capital Markets in New York.

Fed funds futures traders are pricing in 50 basis point hikes at each of the Fed’s June and July meetings, and a chance of a similar move in September.

They have pared their expectations on how high the Fed will ultimately raise its benchmark rate, with the federal funds rate now expected to be at 2.89% in March, compared with expectations on Monday of 3.03%. It is currently at 0.83%.

Benchmark 10-year note yields fell two basis points to 2.743%. They are holding just above a six-week low of 2.706% reached on Thursday and are down from 3.203% on May 9.

The yield curve between two-year and 10-year notes flattened one basis point to 26 basis points.

Yields briefly bounced after data showed that inflation eased in April, boosting hopes that the economy will suffer less damage if the worst of soaring price pressures have passed.

The personal consumption expenditures (PCE) price index gained 0.2% last month after shooting up 0.9% in March. In the 12 months through April, the PCE price index advanced 6.3% after jumping 6.6% in March.

US consumer spending also rose more than expected in April as households boosted purchases of goods and services, which could underpin economic growth in the second quarter.

Jobs data for May released next Friday is the next major US economic focus. It is expected to show that employers added 320,000 jobs during the month, according to the median estimate of economists polled by Reuters.

 

Price Current Yield % Net Change (bps)
Three-month bills 1.065 1.0825 0.028
Six-month bills 1.4975 1.5296 0.034
Two-year note 100-8/256 2.4839 -0.004
Three-year note 100-78/256 2.6419 0.011
Five-year note 99-138/256 2.7242 0.007
Seven-year note 99-224/256 2.7698 0.005
10-year note 101-36/256 2.7432 -0.015
20-year bond 101-72/256 3.1629 -0.020
30-year bond 98-24/256 2.9715 -0.021
DOLLAR SWAP SPREADS
Last (bps) Net Change (bps)
US 2-year dollar swap spread 280.25 249.50
US 3-year dollar swap spread 280.75 264.25
US 5-year dollar swap spread 4.50 -0.50
US 10-year dollar swap spread 7.25 -0.25
US 30-year dollar swap spread -23.00 -0.75

 

(Reporting by Karen Brettell; Editing by Nick Zieminski)

Incoming Philippine finance secretary does not favor tax hikes to tackle debt

MANILA, May 27 (Reuters) – Philippine central bank governor Benjamin Diokno, who takes on a new role as finance secretary next month, said on Friday he does not favor raising taxes even as the incoming government is set to inherit a huge pile of debt..

Diokno, who is President-elect Ferdinand Marcos’s choice to lead the finance ministry, would rather see an improvement in tax administration and collection, including reducing corruption through digitalization, he said.

“To me, grow the economy, focus on tax administration first, improve the collection,” Diokno told ANC news channel.

Diokno’s comments should help ease concerns among labour groups, which have opposed proposals by the outgoing government to impose more excise taxes on oil, defer scheduled tax cuts, and remove some value-added tax exemptions.

Marcos on Thursday said he preferred to reduce the tax burden for those suffering from the economic impact of the pandemic.

Diokno, who before being appointed central bank governor in 2019 served as budget minister, said he was “satisfied with the current tax structure”.

The tax system has already undergone reform in the past six years after incumbent President Rodrigo Duterte’s government lowered corporate and personal income taxes while raising levies on tobacco and alcohol products.

The new Marcos administration is inheriting 11.7 trillion pesos (USD 224 billion) in government debt, equivalent to 60.5% of gross domestic product as of the end of 2021, the highest ratio in 16 years, fueled by borrowing to address the COVID-19 pandemic.

The debt level was almost double the 6.4 trillion pesos of liabilities when Duterte took office in June 2016, government data showed.

“I am not worried about the level of the debt,” said Diokno, who sees it as “easily manageable” as long as the economy is able to return to a pre-pandemic annual growth rate of 6% to 7%.

(Reporting by Neil Jerome Morales; Editing by Ed Davies)

‘Protect the truth’: A Marcos return in Philippines triggers fear for history

MANILA, May 27 (Reuters) – Books about the late Philippine dictator Ferdinand Marcos and his brutal era of martial law are flying off the shelves, spurred by “panic buying” after his son and namesake won a May 9 presidential election.

Ferdinand “Bongbong” Marcos Jr.’s presidency, set to begin on June 30, has many people worried about losing access to books and other accounts of his father’s rule, given his family’s decades-long effort to rehabilitate its name through what critics describe as a campaign of historical revisionism.

“They are panic buying,” Alexine Parreno said of her customers, many them parents buying books about martial law aimed at children.

“They are really worried and scared that the books will be pulled out and that everything will be revised.”

One shopper was Faith Alcazaren, a mother of two, who picked up extra bundles of books to send to friends overseas.

“I felt like the smallest thing I can do and have control over is to protect the truth,” she said.

Thousands of opponents of the senior Marcos were jailed, killed or disappeared during martial law, from 1972 to 1981, when the family name became synonymous with cronyism and extravagance as billions of dollars of state wealth disappeared.

The younger Marcos has called for a revision of textbooks that cover his father’s rule, saying they are teaching children lies.

His choice of education minister, vice president-elect Sara Duterte-Carpio, daughter of outgoing strongman leader Rodrigo Duterte, has raised fears the Marcos family will finally succeed at entrenching its sanitised version of history.

“We already thought that textbooks and the teaching of history in basic education was woefully inadequate in terms of explaining to our youth and children what the martial law period meant,” said Ramon Guillermo, a professor at the University of the Philippines.

“If the Marcoses come back to power and Dutertes are supporting them, we could even have a more difficult situation in teaching what really happened,” said Guillermo.

YEARS OF INVESTIGATION

Guillermo, with a group of fellow scholars, launched a manifesto last week pledging to combat attempts to falsify history to suit the Marcos narrative, and to oppose all censorship and book-banning.

The manifesto, signed by 1,700 people, came after a government task force labelled as communist a children’s book publishing firm selling five titles on martial law and dictatorship it called “#NeverAgain Book Bundle”.

“Never Again!” was the battlecry of millions of protesters who joined the historic “people power” revolution that toppled the 20-year dictatorship in 1986, when the senior Marcos and his notoriously extravagant wife, Imelda, fled with their children into exile in Hawaii.

“History cannot be bought, but books about history can be purchased,” one book buyer said on Instagram.

“We will continue to fight historical revisionism.”

Marcos and Duterte-Carpio did not respond to requests for comment. In a 2020 media forum, Marcos dismissed accusations his family was attempting to rewrite history.

“Who is doing revisionism? They put it in the books, the children’s textbooks that the Marcoses stole this, we did this … what they have been saying about what we stole, what we did, not all of them are true.”

Years of investigation and legal proceedings followed the rule of the senior Marcos. The Presidential Commission on Good Government set up in 1986 has retrieved about USD 5 billion of the Marcos fortune, its chairman, John A. Agbayani said. Another USD 2.4 billion is still caught up in litigation, he said.

‘TSUNAMI OF DISINFORMATION’

The younger Marcos fought the election with the slogan “Together, we shall rise again”, invoking nostalgia for his father’s rule, which his family and supporters have portrayed as a golden age.

His campaign rode what academics called a “tsunami of disinformation” with social media flooded with narratives playing down rights abuses and corruption under his father.

On the day it became clear that Marcos had won, a book published in 1976 that details corruption and abuses during the Marcos regime sold 300 copies, its publisher said.

More than a week later, 500 copies of the book, “The Conjugal Dictatorship of Ferdinand and Imelda Marcos”, were sold within an hour of being posted online.

“I wanted to make sure that inside our home, I can keep a version of the martial law era that has not been tampered with by their hands,” said college student Jose Anonat, who got the book.

In an indication of the sort of history re-writing that Marcos supporters want, Juan Ponce Enrile, the late dictator’s defence minister, said in a conversation with the younger Marcos that appeared on YouTube in 2018, that not one person was arrested for political and religious views, or for criticizing the elder Marcos.

The clip has been viewed more than 1.5 million times.

There were also attempts to remove the terms “dictator” and “kleptocrat” describing the elder Marcos on Wikipedia, said Carlos Nazareno, of the Wiki Society of the Philippines, part of a movement against disinformation.

Carmelo Crisanto, who heads an agency memorializing martial law victims, is digitizing documents relating to 11,103 survivors who were awarded reparations from seized Marcos family wealth. He hopes the database will be online by September, in time for the 50th anniversary of the declaration of martial law.

“These archives will be alive,” said Crisanto. “They will never be suppressed.”

(Reporting by Karen Lema; Editing by Robert Birsel)

Wall Street jumps on retailer outlook hikes, ebbing Fed fears

Wall Street jumps on retailer outlook hikes, ebbing Fed fears

May 26 (Reuters) – Wall Street closed sharply higher on Thursday after optimistic retail earnings outlooks and waning concerns about overly aggressive interest rate hikes by the Federal Reserve put investors in a buying mood.

All three major US stock indexes posted solid gains, with economically sensitive consumer discretionary and microchip stocks beating the broader market.

The tech-laden Nasdaq surged the most – its 2.7% advance was powered by gains in Apple Inc. (AAPL), Tesla Inc. (TSLA) and Amazon.com Inc. (AMZN).

On a weekly basis, the S&P 500, Nasdaq and Dow are on track to snap their longest losing streaks in decades, during which the benchmark S&P plummeted 14.1% and brought it within striking distance of being confirmed as a bear market.

At current levels, all three indexes are poised to notch their biggest weekly gains since mid-March.

“With first quarter earnings essentially over and coming in better than expected, combined with the Fed indicating that they are going to be front-end loading its rate-tightening policy and implying it may pause later in the fall, all of that has given investors reason to feel optimistic,” said Sam Stovall, chief investment strategist at CFRA Research in New York.

Upbeat guidance from retailers appeared to offset dour warnings from their peers in recent weeks.

Department store operator Macy’s Inc M.N jumped 19.3% after raising its annual profit forecast.

Discount chains Dollar General Corp DG.N and Dollar Tree DLTR.O advanced by 13.7% and 21.9%, respectively, following their annual sales forecast hikes, suggesting consumers are shopping for less costly goods amid decades-high inflation.

The minutes from the Federal Open Market Committee’s (FOMC) most recent monetary policy meeting calmed fears that the US central bank could turn more hawkish, a concern which has fed into market volatility in recent weeks.

“We have had 65% more daily price moves of 1% or more than the average since WW2,” Stovall said.

“If the Fed is too aggressive, they’ll choke off inflation but also choke off economic growth,” he added. “It’s like in the winter you want to tap your brakes, not slam on them, to maintain control and avoid spinning out.”

Economic data released on Thursday, including jobless claims, pending home sales and GDP, brought good news wrapped in bad, suggesting the economy is showing just enough softness to prompt a dovish pivot from the Fed by autumn.

The Dow Jones Industrial Average rose 516.91 points, or 1.61%, to 32,637.19; the S&P 500 gained 79.11 points, or 1.99%, to 4,057.84; and the Nasdaq Composite added 305.91 points, or 2.68%, to 11,740.65.

Of the 11 major indexes in the S&P 500, all but real estate ended the session up. Consumer discretionary led the gainers, rising 4.8%, with tech and financials placing and showing at 2.5% and 2.3%, respectively.

Shares of Twitter Inc. (TWTR) jumped 6.4% on news that the social media company is suing billionaire Elon Musk for delayed disclosure of his stake in the company.

US-listed shares of Alibaba Group (BABA) rose 14.8% after the Chinese e-commerce company beat estimates, even as it declined to provide forward guidance in view of COVID-19 restrictions in China.

Advancing issues outnumbered declining ones on the NYSE by a 5.16-to-1 ratio; on Nasdaq, a 2.95-to-1 ratio favored advancers.

The S&P 500 posted three new 52-week highs and 29 new lows; the Nasdaq Composite recorded 28 new highs and 116 new lows.

Volume on US exchanges was 11.43 billion shares, compared with the 13.22 billion average over the last 20 trading days.

(Reporting by Stephen Culp; additional reporting by Devik Jain and Anisha Sircar in Bengaluru; editing by Jonathan Oatis)

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