Stocks gain, U.S. futures steady before bank results - BNN Bloomberg

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Stocks climbed and Wall Street equity futures were steady as investors assessed prospects for less-aggressive rate hikes as inflation pressures ease and looked forward to earnings from major banks for insights on the state of the U.S. economy.

European stocks gained, set for their strongest performance in the first two weeks of January on record. Air France-KLM jumped after analysts upgraded the airline because of a bullish view on the sector amid pent-up travel demand. S&P 500 and Nasdaq 100 contracts were little changed. Tesla Inc. slumped in premarket trading after slashing prices, dragging shares in other carmakers lower.

A gauge of dollar strength slipped, while Treasury yields were steady after dropping in the U.S. session. The pound was stronger after data showed the U.K. economy grew unexpectedly in November. “The more favorable inflation print could allow the Fed to hike by 25 basis points next month rather than the more aggressive hikes it has been using up until now,” Mark Haefele, chief investment officer at UBS Global Wealth Management, wrote in a note. “But despite this positive outcome, we continue to believe it is too early for an imminent Fed pivot and the conditions are not yet in place for a sustainable equity rally.

Traders looked past initial disappointment with Thursday's in-line U.S. consumer price index to focus on the idea that aggressive monetary policy may be gradually achieving its desired results. The swap market is showing less than 50 basis points of tightening priced in for the next two Fed gatherings: a small chance of no move at all in March.

 

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