Trump tariff pledge roils currencies

Donald Trump’s vow of hefty tariffs threatened to continue to cloud Asian trading on Wednesday after the US president-elect’s surprise announcements roiled currency markets.

Officials from Mexico, Canada, and China warned of broad negative economic consequences after Trump called for a 25% tariff on imports from Canada and Mexico and an additional 10% levy on Chinese goods, until the countries clamped down on illicit drugs and migrants crossing the border.

The reaction in these countries’ currencies against the dollar was swift: China’s yuan fell to its weakest in nearly four months, Canada’s currency hit its lowest in more than four years against the US greenback, while the Mexican peso sank over 2%.

Some of the reaction moderated toward the end of the US session, as investors considered Trump’s salvo potentially part of a negotiating tactic that they were more prepared for after experiencing his first term as US president.

The reaction was also felt in equities, albeit more modestly. China’s blue-chip CSI300 index edged down 0.2%. European indexes also declined, with Europe’s STOXX 600 off 0.6%, while the US benchmark S&P 500 ended with a 0.6% gain.

Some pockets were hit harder, including auto stocks amid fears the tariffs would rattle supply chains. In Europe, Stellantis shares sank nearly 5%, while Volkswagen dropped more than 2%. In the US, General Motors fell 9%.

The day’s action served as a reminder of the volatility Trump could bring to markets, especially with his desire to implement tariffs, a day after his choice of prominent investor Scott Bessent to lead the Treasury Department appeared to calm concerns in the bond market.

Elsewhere, markets will be following the fallout for Adani Group. Two more credit rating agencies cut their outlook for the Indian conglomerate, whose billionaire founder Gautam Adani has been charged by US authorities over an alleged bribery scheme.

Inflation will also be in focus on Wednesday, with the release of the key US personal consumption expenditures price index, a measure followed closely by the Federal Reserve. Minutes released on Tuesday covering the latest Fed meeting showed central bank officials appeared divided over how much farther they may need to cut interest rates.

In other central bank developments, the Reserve Bank of New Zealand was set to give its latest monetary policy decision, with expectations that it would lower interest rates by 50 basis points.

Here are key developments that could provide more direction to markets on Wednesday:

– Reserve Bank of New Zealand monetary policy meeting

– Australia CPI (Oct)

– US PCE inflation data (Oct)

(Editing by Deepa Babington)

S&P 500 to gain over 8% by end of next year after strong 2024

NEW YORK – The S&P 500 will rise over 8% between now and end-2025 as US interest rate cuts and potentially less regulation under President-elect Donald Trump extend the market’s strong run, according to a Reuters poll of equity strategists.

Continued US economic health will boost earnings growth, and some strategists cited financials as among their top sector picks going into 2025, partly because of prospects for deregulation under Trump.

Some market participants expect Trump’s agenda of tax cuts and deregulation will propel economic growth and further gains in the market.

The benchmark S&P 500 will end 2025 at 6,500 points, according to the median forecast of 48 equity strategists, analysts, brokers and portfolio managers collected Nov. 15-26. That’s up about 8.5% from its 5,987.37 close on Monday.

The latest end-2025 forecast is sharply higher than the 5,900 forecast in a Reuters poll in August.

Stocks rallied to record highs following the Nov. 5 presidential election which Republican Trump won, four years after being voted out of the White House.

Overall, the S&P 500 has surged about 26% so far in 2024, fueled in part by sharp gains in Nvidia, Microsoft and other US heavyweights dominating the race for artificial intelligence technology.

David Kostin, chief US equity strategist at Goldman Sachs, forecast in his recent 2025 equity outlook that the “Magnificent 7” group of high-performing stocks – which include Nvidia and Microsoft – are likely to outperform next year but “by a much smaller magnitude.”

He sees higher earnings growth overall for the S&P 500 pushing the index to 6,500 by the end of next year.

Analysts expect earnings growth of 14.2% in 2025 for the entire S&P 500, up from 10.2% this year, according to LSEG.

Following this year’s rally, the S&P 500 is trading at 22.6 times expected earnings, compared with a 10-year average of about 18, according to LSEG.

“We’re not concerned about valuations” because of the expected growth in earnings and the economy, Mary Ann Bartels, chief investment strategist at Sanctuary Wealth said.

Also, she said, the Trump administration may be positive for business.

Worries remain over a potential inflationary rebound, which would change how much the Federal Reserve is able to keep cutting rates.

The Fed embarked on its policy easing cycle with a large half-percentage-point rate cut in September, its first reduction in borrowing costs since 2020.

Some of Trump’s plans, especially those for higher tariffs, could drive up consumer prices. On Monday, Trump, who takes office on Jan. 20, pledged big tariffs on the United States’ three largest trading partners – Canada, Mexico and China.

Turmoil in the Middle East is also still a concern for investors.

When asked whether a stock market correction of at least 10% is likely early next year, eight of 17 poll participants who answered an additional question said it is likely and two said it is highly likely. Six said it was unlikely and one said highly unlikely.

Among sectors, financials are up about 35% for the year to date, leading gains among S&P 500 sectors, with technology up 33%.

Bank stocks have benefited in part from prospects for increased merger activity.

Deutsche Bank strategists wrote in an outlook report this week they remain overweight financials “where a multitude of tailwinds are converging.”

The poll has the Dow Jones industrial average .DJI finishing next year at 46,600. The index closed at 44,736.57 on Monday.

(Reporting by Caroline Valetkevitch; additional reporting by Chuck Mikolajczak, Stephen Culp, Sinead Carew, Chibuike Oguh, Alden Bentley, and Noel Randewich; additional polling by Jaiganesh Mahesh and Rahul Trivedi; Editing by Bernadette Baum)

Gold tumbles over 3% on reports of Israel-Hezbollah ceasefire, US Treasury pick

Gold prices plunged over 3% on Monday, breaking a five-session rally to its highest in nearly three weeks, as reports of Israel nearing a ceasefire with Hezbollah, coupled with Trump’s nomination of Scott Bessent as the US Treasury Secretary soured the precious metal’s safe-haven appeal.

Spot gold fell 3.4% to USD 2,619.66 per ounce by 02:01 p.m. ET (1901 GMT), its biggest daily percentage decline since June 07. US gold futures settled 3.5% lower to USD 2618.50.

Gold prices were primed for a sell-off on buying exhaustion after last week’s rally. Scott Bessent’s Treasury Secretary appointment further took away some of the risk premium associated with the US, said Daniel Ghali, commodity strategist at TD Securities.

“And even more so, reports that Israel and Lebanon have agreed to terms of an agreement to end the Israel and Hezbollah conflict have pushed gold prices even further (lower).”

Gold is traditionally seen as a safe investment during economic and geopolitical uncertainty such as conventional or trade wars.

Some market participants see Bessent as less negative for a trade war, said UBS analyst Giovanni Staunovo.

Bullion hit its highest since Nov. 6 in early Asian trade following last week’s nearly 6% weekly surge, its best since March 2023, spurred by escalating tensions in the Russia-Ukraine conflict.

Traders are also gearing up for a pivotal week, with minutes from the Federal Reserve’s November meeting, US GDP revisions, and core PCE data expected to provide insights into the central bank’s policy outlook.

“I still anticipate a 25 bps rate cut in December, but recent Fed speakers have taken on a more cautious tone heading into 2025, which could pose a bit of a headwind for gold,” said Peter Grant, vice president and senior metals strategist at Zaner Metals.

Spot silver dropped 3.3% to USD 30.28 per ounce, platinum was down 2.6% to USD 938.57 while palladium slipped 3.1% to USD 977.94.

(Reporting by Sherin Elizabeth Varghese, Rahul Paswan and Swati Verma in Bengaluru; Editing by Tasim Zahid and Mohammed Safi Shamsi)

US bond market rallies on Trump Treasury pick, short covering

NEW YORK – US Treasury yields declined sharply on Monday as investors expected a more moderate than feared US fiscal trajectory after hedge fund manager Scott Bessent was nominated as US Treasury secretary by President-elect Donald Trump on Friday.

Benchmark 10-year Treasury yields were down by some 15 basis points while two-year yields declined by about 10 points, leading the closely watched curve that compares yields on those two maturities to invert.

Expectations of a widening budget deficit due to tax cuts under Trump’s Republican government have pushed Treasury yields higher over the past few weeks. The choice of Bessent, however, was largely seen by investors as limiting the potentially negative impact of Trump’s policies on US fiscal health as well as putting a lid on expected increases in tariffs.

“He’s a Wall Street guy, he’s very good at what he does, he’s not an extremist to the left or right, he’s a sensible smart businessman, and I think the market likes that, and he’s anti-deficit,” said Tony Farren, managing director at Mischler Financial Group.

Benchmark 10-year yields stood at 4.269%, down from 4.41% on Friday and hitting their lowest since Nov. 6 during the day. Two-year yields, which more closely reflect monetary policy expectations, were at 4.274%, from 4.369% on Friday. Further out, 30-year yields dropped to 4.451%, their lowest since Nov. 7.

The rally was exacerbated by investors closing off short positions – or bets that yields, which move inversely to bond prices, would rise.

“Everyone is offside,” said Thomas Hayes, chairman of Great Hill Capital in New York. “Bessent was the catalyst … the market was at an extreme and Bessent was the ‘excuse’ for it turning around,” he added.

In the week ended on Nov. 19, speculators had increased their net short bets on five-year Treasury futures to the largest on record, according to data from the Commodity Futures Trading Commission on Friday. Shorts in two-year Treasury futures have also been rising over the past two months.

Contributing to Monday’s bond rally, a USD 69 billion Treasury auction of two-year notes was well received by the market. The notes were sold with a high yield of 4.274%, about two basis points below the market at the bidding deadline, a sign investors were willing to pay up to absorb the issuance.

2/10 CURVE INVERTS

The part of the Treasury yield curve that plots two-year and 10-year yields was slightly inverted, as short-term bonds yielded about 0.5 basis points more than longer ones.

The inversion, the first in over a month, was partly due to the Bessent nomination easing fiscal concerns, Capital Economics said in a note. It added, however, that it expects the curve to steepen going forward, as rate cuts will put downward pressure on short-term yields and fiscal worries will lift longer-dated yields.

For Farren at Mischler, a flattening of the curve was to be expected. “With Trump being president, the Fed is going to be less aggressive,” he said.

On Monday, traders in interest rates futures were assigning a 52.5% probability to a 25 basis point interest rate cut by the Federal Reserve in December, down from a 59% probability on Monday last week, CME Group data showed.

Bessent told the Wall Street Journal in an interview published on Sunday he will prioritize delivering on election tax cut pledges, while also focusing on cutting spending and maintaining the status of the dollar as the world’s reserve currency.

The logic behind Monday’s bond rally was “relatively straightforward” as it was based on a view that Bessent will “keep a leash on deficits and take a thoughtful approach to tariffs,” strategists at BMO Capital Markets said in a note.

“Bessent won’t prevent tariffs from being utilized or borrowing needs from increasing,” they wrote. “It’s simply the perception that both will be approached in a more methodical manner with an adherence to traditional economic policy.”

(Reporting by Davide Barbuscia; editing by Jonathan Oatis)

Wall Street closes higher; small-caps hit record high after Trump nominates Bessent

Wall Street’s main indexes ended higher on Monday, with the small-cap Russell 2000 index hitting an all-time high after Scott Bessent’s nomination as US Treasury secretary helped push bond yields lower.

Focus also turned to talks of a ceasefire deal between Israel and Lebanon, which pushed oil prices lower, dragging the Energy index 2% lower.

President-elect Donald Trump ended weeks of speculation when he named his choice late on Friday, with some investment strategists saying Bessent could take measures to restrain further government borrowing, even as he follows through on fiscal and trade campaign pledges.

The nomination of Bessent has eased some of the fiscal concerns about possible new tariffs, which had pushed bond yields higher ahead of the election.

“This time, the focus is on tariff policy – especially now that the choice of Scott Bessent as Treasury secretary seems to have allayed major fiscal concerns,” said James Reilly, senior market economist at market desk Capital Economics.

According to preliminary data, the S&P 500 gained 17.81 points, or 0.30%, to end at 5,987.15 points, while the Nasdaq Composite gained 51.50 points, or 0.27%, to 19,055.15. The Dow Jones Industrial Average rose 439.02 points, or 0.99%, to 44,735.53.

Advancing issues outnumbered decliners by a 3.01-to-1 ratio on the NYSE. There were 836 new highs and 40 new lows on the NYSE.

The small-cap index .RUT hit an all-time intraday high of 2,466.49, eclipsing the record level it touched three years ago, as Treasury yields dropped sharply, with the 30-year bond leading the yield declines across the board.

“Areas that were lagging for most of this year are beginning to outperform, such as the small-cap and the mid-cap stocks, not just due to Trump, but also due to the Federal Reserve cutting rates,” said Adam Sarhan, chief executive of 50 Park Investments in New York.

Expectations that Trump, along with a Republican Congress, can make good on his promise of business-friendly policies have been the latest tailwinds for small-cap companies. They have been in the spotlight since the US Federal Reserve commenced its monetary policy easing cycle in September.

Lower yields helped the rate-sensitive real estate sector rise, while the housing index also surged by 4.5%.

Barclays raised its full-year 2025 forecast for the S&P 500, while Deutsche Bank set its target at 7,000 points by the end of 2025.

However, concerns remain that inflationary pressures could spike and slow the pace of the Fed’s policy easing.

Investors have recently swung between expectations of a pause versus a further cut in interest rates at the Fed’s December meeting. The CME Group’s FedWatch Tool shows a 56.2% probability the central bank will deliver another 25 basis-point cut.

Consumer Discretionary stocks led sectoral gains, aided by Amazon.com’s 2.2% rise.

The Personal Consumption Expenditure report, the central bank’s preferred inflation gauge, will be on investors’ radar later this week, which includes the US Thanksgiving holiday.

Macy’s fell 2.2% after the department-store operator delayed the publication of its third-quarter results due to an accounting issue.

Bath & Body Works raised its forecast for full-year adjusted profit, sending the retailer’s shares up 16.5%.

The S&P 500 posted 106 new 52-week highs and no new lows while the Nasdaq Composite recorded 352 new highs and 66 new lows.

Volume on US exchanges was 16.69 billion shares, compared with the 14.93 billion average for the full session over the last 20 trading days.

(Reporting by Saeed Azhar in New York and Johann M Cherian and Purvi Agarwal in Bengaluru; Editing by Maju Samuel and Matthew Lewis)

Oil falls more than USD 2 a barrel on possible Middle East peace deal

HOUSTON – Oil prices fell more than USD 2 a barrel on Monday after multiple reports that Israel and Lebanon had agreed to the terms of a deal to end the Israel-Hezbollah conflict, citing unnamed senior US officials.

Brent crude futures settled at USD 73.01 a barrel, down USD 2.16, or 2.87%. US West Texas Intermediate crude futures finished at USD 68.94 a barrel, down USD 2.30 or 3.23%.

Israel said on Monday it is moving toward a ceasefire in the war with Hezbollah but there are still issues to address, while Lebanese officials voiced guarded optimism but said Israeli Prime Minister Benjamin Netanyahu was not to be trusted.

“It seems the news of a ceasefire between Israel and Lebanon is behind the price drop, though no supply has been disrupted due to the conflict between the two countries and the risk premium in oil has been low already before the latest price decline,” said Giovanni Staunovo of UBS.

Oil markets are being pushed up and down on rising or falling supply disruption fears, Phil Flynn, senior analyst at Price Futures Group, said in a Monday note.

“A report that Israel’s Prime Minister Netanyahu approves Lebanon ceasefire deal in principle could be a bearish catalyst, yet we must see more details as they become available. Last week the world was stunned as Russia launched supersonic missiles” at Ukraine, Flynn wrote in his energy report.

Both Brent and US WTI contracts last week notched their biggest weekly gains since late September to reach their highest settlement levels since Nov. 7 after Russia fired a hypersonic missile at Ukraine in a warning to the United States and the UK following strikes by Ukraine on Russia using US and British weapons.

OPEC+, at its next meeting on Sunday, may consider leaving its current oil output cuts in place from Jan. 1, Azerbaijan’s Energy Minister Parviz Shahbazov told Reuters.

The group, which includes the Organization of Petroleum Exporting Countries plus allies like Russia, has postponed hikes this year amid demand worries.

Azerbaijan is a member of OPEC+, which will meet online on Dec. 1.

(Reporting by Erwin Seba in Houston, Additional Reporting by Enes Tunagur in London, Arunima Kumar in Bengaluru, Gabrielle Ng, and Florence Tan; Editing by Susan Fenton, Jonathan Oatis, Will Dunham, and Chris Reese)

Trump’s Treasury pick boosts bond market as dollar eases

Donald Trump’s pick to be US Treasury Secretary proved to be a balm for the bond market, while the dollar followed yields lower in a move poised to influence trading in Asia on Tuesday.

The choice of prominent investor Scott Bessent made late on Friday, rippled through markets on Monday, after days of speculation over who Trump would choose to be essentially the highest-ranking US economic official.

Treasury yields, which move opposite to prices, fell sharply, with the benchmark 10-year yield touching its lowest level in more than two weeks. Treasury yields had been rising at a torrid pace, partially due to concerns that Trump’s presidency would dramatically widen the federal deficit.

But Bessent was seen as someone who might moderate any negative impact of Trump’s fiscal policies. Some strategists said his nomination was a relief as he understands markets and his appointment could reduce the severity of potential tariffs, which are favored by Trump.

The dollar index, which has surged since early October, pulled back sharply on the day. A weaker dollar could offer some relief to emerging market countries that have borrowed heavily in the US currency, amid concerns about a rising dollar under Trump.

The removal of uncertainty over the Treasury secretary position combined with lower bond yields boosted equities. MSCI’s gauge of stocks across the globe was up about 0.4%, while the US benchmark S&P 500 closed up 0.3%.

The spotlight was on US small-cap stocks, with the Russell 2000 hitting a record intraday high for the first time in three years.

Some investors say small caps could be in the sweet spot, as Trump’s push for lower taxes and reduced regulations favors smaller companies, while the Fed’s lowering of interest rates also stands to help smaller companies that tend to rely more on debt financing.

Not everything was rosy in equities, as Chinese shares fell amid concerns about a trade war hurt risk appetite. The Shanghai Composite Index touched its lowest in about a month.

Elsewhere, signs of a ceasefire deal between Israel and militant group Hezbollah in Lebanon prompted a pullback in oil prices and gold, with the Treasury secretary news also dulling the precious metal’s allure.

With the Thanksgiving holiday in the US coming on Thursday, trading was expected to thin out, even as central bank decisions in New Zealand and South Korea and inflation data in the US were set to provide some excitement later in the week.

Here are key developments that could provide more direction to markets on Tuesday:

– Singapore manufacturing output (Oct)

– Hong Kong export/import data (Oct)

– Fed meeting minutes

(Reporting by Lewis Krauskopf; Editing by Bill Berkrot)

Safe-haven gold on track for weekly gain

Gold prices were steady on Friday but still poised for a weekly gain, driven by safe-haven demand due to escalating geopolitical concerns, while the market awaited clearer signals on the US interest rate outlook.

FUNDAMENTALS

* Spot gold was little changed at USD 2,669.99 per ounce as of 0006 GMT and up over 4% for the week so far. Bullion rose to over one-week high in the previous session.

* US gold futures edged down by 0.1% to USD 2,672.00.

* Data on Thursday showed that weekly initial jobless claims dropped 6,000 to a seasonally adjusted 213,000, a seven-month low, and below the 220,000 estimate of economists polled by Reuters, indicating job growth rebounded after being disrupted by hurricanes and labor strikes last month.

* On the geopolitical level, Russia fired a hypersonic intermediate-range ballistic missile at the Ukrainian city of Dnipro on Thursday in response to the US and UK allowing Kyiv to strike Russian territory with advanced Western weapons, in a further escalation of the 33-month-old war.

* Non-yielding assets like bullion thrive in a lower interest rate environment and during times of geopolitical uncertainty.

* Meanwhile, Chicago Federal Reserve President Austan Goolsbee on Thursday reiterated his support for further interest rate cuts and his openness to slowing them down.

* Traders now expect a 58% chance of a 25-basis-point rate cut in December, as per the CME Fedwatch tool.

* Investors will scan the US consumer sentiment (final) data, due later in the day, along with the remarks from Fed Gov. Michelle Bowman, for further clues on rate outlook.

* SPDR Gold Trust GLD, the world’s largest gold-backed exchange-traded fund, said its holdings rose 0.29% to 877.97 metric tons on Thursday.

* Spot silver fell 0.1% to USD 30.75 per ounce, platinum steadied at USD 961.53 and palladium edged up 0.1% to USD 1,037.57. All three metals were on track for the weekly rise.

DATA/EVENTS (GMT)

0700 Germany GDP Detailed QQ SA, YY NSA Q3

0700 UK Retail Sales MM, YY Oct

0700 UK Retail Sales Ex-Fuel MM Oct

0815 France HCOB Mfg, Serv, Comp Flash PMIs Nov

0830 Germany HCOB Mfg, Serv, Comp Flash PMIs Nov

0900 EU HCOB Mfg, Serv, Comp Flash PMIs Nov

0930 UK Flash Comp, Mfg, Serv PMIs Nov

1445 US S&P Global Mfg, Serv, Comp Flash PMIs Nov

1500 US U Mich Sentiment Final Nov

(Reporting by Daksh Grover in Bengaluru; Editing by Alan Barona)

Oil rises 2% on supply worries as Russia-Ukraine war escalates

HOUSTON – Oil climbed nearly 2% on Thursday as tensions between Russia and Ukraine were rapidly rising as the countries launched missiles at each other, worrying markets about crude supply if the conflict widened.

Russian President Vladimir Putin said on Thursday that Russia had launched a hypersonic medium-range ballistic missile attack on a Ukrainian military facility, and warned the West that Moscow could strike the military installations of any country whose weapons were used against Russia.

Putin said the West was escalating the conflict in Ukraine by allowing Kyiv to strike Russia with long-range missiles, and that the war was becoming a global conflict.

Ukraine fired US and British missiles at targets inside Russia this week despite warnings by Moscow that it would see such action as a major escalation.

Brent crude futures rose USD 1.42, or 1.95%, to USD 74.23 per barrel, while US West Texas Intermediate crude futures increased USD 1.35, or 2%, to USD 70.10.

“The market’s focus has now shifted to heightened concerns about an escalation in the war in Ukraine,” said Ole Hvalbye, commodities analyst at SEB.

Russia is the world’s second-largest crude oil exporter after Saudi Arabia, so major disruptions could impact global supplies.

“For oil, the risk is if Ukraine targets Russian energy infrastructure, while the other risk is uncertainty over how Russia responds to these attacks,” said ING analysts in a note.

Weighing on the market was a rise in US crude inventories of 545,000 barrels to 430.3 million barrels in the week ended Nov. 15, exceeding analysts’ expectations.

Gasoline inventories last week rose more than forecast, while distillate stockpiles posted a larger-than-expected draw, according to the Energy Information Administration data.

China on Thursday announced policy measures to boost trade, including support for energy product imports, amid worries over US President-elect Donald Trump’s threats to impose tariffs.

OPEC+ may push back output increases again when it meets on Dec. 1 due to weak global oil demand, said three OPEC+ sources familiar with the discussions.

The group, which combines the Organization of Petroleum Exporting Countries and allies like Russia, pumps around half the world’s oil. It had initially planned to gradually reverse production cuts from late 2024 and through 2025.

Meanwhile, Chicago Federal Reserve President Austan Goolsbee on Thursday reiterated his support for further interest rate cuts and his openness to doing them more slowly.

Slower-than-expected interest rate cuts keep the cost of borrowing elevated in the meantime, which can slow economic activity and dampen demand for oil.

(Reporting by Arathy Somasekhar in Houston, Paul Carsten in London, and Siyi Liu in Singapore; Editing by Bernadette Baum, Kirsten Donovan, Philippa Fletcher, David Gregorio, Cynthia Osterman, and Diane Craft)

Wall Street closes higher as Dow, S&P hit one-week tops

Wall Street’s main indexes closed higher after choppy trading on Thursday, with the blue-chip Dow and the S&P 500 hitting one-week tops.

Dow Jones Industrial Average gains were aided by cloud company Salesforce’s 3.1% advance after three brokerages lifted their price targets on the stock.

Shares of Wall Street’s biggest company, Nvidia, added 0.5% after teetering following its earnings release on Wednesday. The chip company surpassed expectations for quarterly results, and projected fourth-quarter revenue above estimates.

“(Nvidia’s) earnings report was really, really good. Some of the whisper numbers were higher and they disappointed there, but the fundamentals of AI and Nvidia continue to fire on all cylinders and the outlook for next year is positive,” said Anthony Saglimbene, chief market strategist at Ameriprise Financial.

Some investors were unimpressed that the forecast was its slowest in seven quarters.

The broader Philadelphia SE Semiconductor index climbed 1.6%.

The Dow Jones Industrial Average rose 461.88 points, or 1.06%, to 43,870.35, the S&P 500 gained 31.60 points, or 0.53%, to 5,948.71 and the Nasdaq Composite gained 6.28 points, or 0.03%, to 18,972.42.

Alphabet slid 4.7% to touch a four-week low after the Justice Department argued to a judge that Google must sell its Chrome browser and take other measures to end its monopoly on online search.

The stock’s losses weighed on the communication services sector, which was the biggest sectoral decliner, falling 1.73%. Utilities stocks led the S&P higher.

Amazon.com fell 2.2% after a report said it will likely face an EU investigation next year into whether it favors its own brand products on its online marketplace.

On the data front, a weekly report on jobless claims showed they fell unexpectedly last week, suggesting a rebound in job growth in November.

Investors will be closely monitoring commentary from Federal Reserve officials before the mid-December FOMC meeting.

Money-market bets favor a 25-basis-point interest rate cut by the Fed in December, according to the CME Group’s FedWatch.

“We’ve moved on from the election a bit, we got the Nvidia report, so the next thing markets will look for is the Fed meeting, and some policy speak from Fed officials this week have pointed to maybe a pause in the making for December,” Saglimbene said.

Richmond Fed President Tom Barkin said the United States is more vulnerable to inflationary shocks than in the past, according to a media report.

Chicago Federal Reserve President Austan Goolsbee said on Thursday he supports further interest rate cuts and is open to doing them more slowly.

Traders also monitored geopolitical tensions between Ukraine and Russia that sent crude prices higher and aided a 0.8% gain in the energy sector.

Shares of machinery manufacturer Deere gained 8% after reporting an upbeat fourth-quarter profit, while AI company Snowflake jumped 32.7% after raising its annual product revenue forecast.

Advancing issues outnumbered decliners by a 3.17-to-1 ratio on the NYSE. There were 380 new highs and 88 new lows on the NYSE.

On the Nasdaq, 2,875 stocks rose and 1,444 fell as advancing issues outnumbered decliners by a 1.99-to-1 ratio. The S&P 500 posted 67 new 52-week highs and four new lows while the Nasdaq Composite recorded 138 new highs and 149 new lows.

Volume on US exchanges was 15.32 billion shares, compared with the 14.55-billion average for the full session over the last 20 trading days.

(Reporting by Abigail Summerville in New York; additional reporting by Purvi Agarwal and Johann M Cherian in Bengaluru; Editing by Rod Nickel)

2024 Mid-Year Economic Briefing: Navigating the Easing Cycle

Investing with Love: A Mother’s Guide to Putting Money to Work

Investor Series: An Introduction to Estate Planning

Monthly Recap: BSP to outpace the Fed in rate cuts

Quarterly Economic Growth Release: 5.4% Q12025