US stocks rose and the dollar erased an advance as a middling inflation reading fueled speculation the Federal Reserve won’t be forced to accelerate the pace of rate hikes.
The S&P 500 Index opened higher after shares slipped on Monday ahead of the inflation reading. Tuesday’s report reinforced the sense that economic growth is picking up without runaway price increases. The 10-year Treasury yield slumped below 2.85 per cent and Bloomberg’s Dollar Index slipped.
The US inflation data set the tone for traders, who are still trying to second-guess the path of monetary tightening in the world’s biggest economy ahead of the Fed meeting next week. The numbers, which were in line with expectations, gave them little to go on. A Treasury auction later on Tuesday may help gauge how much investors are worried about inflation.
Politics remain in focus after President Donald Trump ousted Secretary of State Rex Tillerson. That move followed an executive order from Trump blocking Broadcom Ltd. from acquiring Qualcomm Inc, scuttling a $117 billion (Dh429.4 billion) hostile takeover that had been the subject of scrutiny over the deal’s threat to US national security.
The European stock benchmark gave up its increase as the trading session wore on. Earlier, Japanese stocks had also fluctuated, but they closed higher as Hong Kong and Chinese shares slipped. The yen dropped the most in more than a month as investors digested the political fallout from a scandal embroiling the country’s finance minister.
Elsewhere, emerging-market equities gained for a fourth day. West Texas crude fluctuated as traders weighed strong demand and swelling supplies. Bitcoin gained, holding above $9,100.