Latest
Recommended
Published: Sat, February 17, 2018
Economy | By Melissa Porter

Yes, Stocks Climb When Interest Rates Rise — S&P Dow Jones

Yes, Stocks Climb When Interest Rates Rise — S&P Dow Jones

Benchmark 10-year U.S. Treasury yields fell to 2.8876 after hitting a more than four-year peak of 2.944 percent.

But investors have seen this playbook before. A simple moving average is easy to calculate, which allows it to be employed fairly quickly and easily.

Both subsets consist of a broad-maturity index as well as two targeted maturity indices that track bonds in the three to five year and five to seven year maturity ranges.

US stocks managed to shake off inflation data as consumer prices increased more than expected.

Q: How bad was this market drop?

The Nasdaq composite surged 112.81 points, or 1.6 percent, to 7,256.43. The Dow has now recouped about half of its losses suffered in the recent sell-off.

Gold stocks came under pressure despite a modest increase by the price of the precious metal, as gold for April delivery inched up USD0.90 to USD1,356.20 an ounce. The VIX Volatility Index was lower at 19.27 for a loss of -5.70 points or -22.83%.

Technology shares were another strong segment, with Apple climbing 1.8 per cent, Amazon 2.6 per cent, Facebook 3.7 per cent and Netflix 3.0 per cent.

Locally, ASX SPI 200 futures are higher, indicating the Australian market will bounce at the open. It took 15 months for the index to climb 5 percent above where it was when the August 2015 slide began.

The Dow Jones industrial average climbed 39 points, or 0.2 percent, to 25,242.

This is short-covering, pure and simple.

"I think the fears of the economy overheating have been a little bit balanced out with the combination of these two numbers", said Katie Nixon, chief investment officer for Northern Trust Wealth Management.

Plus, corporate earnings are going up.

The S&P 500 Index (SPX - 2, 731.20) added 32.6 points, or 1.2%, by the close.

Q: What could trip things up? Core retail spending-excluding autos - also disappointed, recording no growth in the month of January after a DOWN-wardly revised 0.1% (from 0.4%) in the previous month. S. indictment over alleged Russian meddling in the 2016 presidential election cooled gains on Wall Street.

The markets will be watching new Fed Chairman Jerome Powell when he deliver a report on monetary policy to the House of Representatives on Feb. 28, and when he holds a scheduled press conference following the Fed's next policy-making meeting on March 21. Conversely, if an ETF's beta is 0.65, it is theoretically 35% less volatile than the market.

The Labor Department reported early Wednesday that core consumer prices rose 0.3 percent last month, more than expected. This week has seen its initial worries with inflation and interest rates swapped out with a new bullish trend.

In other energy trading, wholesale gasoline fell 2 cents to $1.68 a gallon.

In the opinion of Desmond Lachmann, a long time Macro-Economics expert has expressed concerns over the US' performance.

Fourth-quarter results for European companies in the STOXX 600 index .STOXX are expected to increase 14.6 percent from a year ago, while the blended earnings growth estimate for the S&P 500 is 15 percent, Thomson Reuters I/B/E/S data show.

Like this: