Stock futures gained Thursday as Treasury yields fell, with investors betting the Federal Reserve could be done raising rates for 2023. Futures tied to the Dow Jones Industrial Average added 171 points, up 0.5%. S&P 500 futures gained 0.7%, and Nasdaq 100 futures advanced 1.1%. Moderna shares dropped 10% in the premarket after the pharma giant reported a sharp third-quarter loss. SolarEdge tumbled more than 15% after posting an unexpected loss and offering dismal guidance for fourth-quarter revenue. Those moves come after the Fed on Wednesday kept interest rates unchanged again and upgraded its assessment of the U.S. economy. To be sure, Chair Jerome Powell would not rule out a rate increase at the December meeting. “We expected Powell to talk tough and do his best to keep markets from taking the two successive ‘skips’ in interest rate hikes as a green light for risk assets,” said Chris Zaccarelli, chief investment officer for the Independent Advisor Alliance. But, “we were surprised at how detailed he has been in his language that the Fed is still worried about inflation and wouldn’t hesitate to raise rates again in the near future.” Investors digested further signs of softening in the labor market. Weekly jobless claims on Thursday ticked higher to 217,000 for week ending Oct. 28, more than the 210,000 in the previous week and the 214,000 consensus estimate from Dow Jones. Stocks rallied Wednesday following the Fed decision. The Dow climbed more than 200 points on Wednesday, while the S&P 500 and Nasdaq Composite each ended up more than 1%. On the economic front, closely watched statistics on nonfarm payrolls, the unemployment rate and hourly wages are slated for release on Friday morning. U.S. Treasury yields declined on Thursday as investors bet the Federal Reserve could be done raising rates for the year. The yield on the 10-year Treasury was down by 8 basis points at 4.711%. The 2-year Treasury was last more than 1 basis point lower at 4.95%. It had previously dropped as low as 4.9250%, an almost two-month low. Asia markets rose sharply, with South Korea in the lead, as investors took comfort from the U.S. Federal Reserve’s decision to leave its benchmark interest rates unchanged, while parsing inflation and trade data from across the region. Japan’s Nikkei 225 gained 1.1% and finished at 31,949.89, extending gains from Wednesday. The Topix added 0.51% to 2,322.39, hitting fresh three-week highs and notching a three-day winning streak. South Korea’s Kospi jumped 1.81%, leading gains in Asia and closing at 2,343.12 while the Kosdaq surged 4.55%, marking its largest one-day gain since June 24, 2022. Hong Kong’s Hang Seng index gained 0.78% in the final hour of trading, while China’s CSI 300 closed 0.47% to 3,554.19, the only major benchmark in negative territory. Taiwan’s Taiex surged 2.23% to 16,396.85, recording its best one-day percentage gain in over nine months. In Australia, the S&P/ASX 200 rose 0.9% to close at 6,899.7, edging close to its highest level in nearly two weeks. Oil gained 1% on Thursday to snap its three-day decline, as risk appetite returned to financial markets after the U.S. Federal Reserve kept benchmark interest rates on hold. Brent crude futures rose 74 cents, or 0.9%, to $85.37 a barrel by 8:57 a.m., while U.S. West Texas Intermediate crude futures gained 63 cents, or 0.8%, to $81.06 a barrel. Gold prices rose on Thursday, supported by a retreat in the U.S. dollar and Treasury yields as investors wagered that the Federal Reserve may have concluded rate hikes after the central bank held interest rates steady. Spot gold was up 0.3% at $1,9889 per ounce 8:55 a.m.. U.S. gold futures gained 0.5% to $1,997.50.
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