Global Stocks Rally as Fed Remains Uneasy on Inflation

“We could see an entirely different picture by the afternoon”. The index also closed above its 50-day moving average for the very first time since August 18.

HONG KONG – Chinese shares have surged as dealers returned from a week-long break that saw a global advance, but a regional rally mostly petered out, with Tokyo ending a six-day winning streak.

“So, the minutes showed a Fed mired in indecision, erring on the side of dovishness”, said Stephen Guilfoyle, managing director at Deep Value.

The Energy Index jumped 3.3 percent, while the Diversified Metals and Mining Index added another 1 percent to this week’s furious rally.

Minutes from the Federal Reserve’s September meeting showed policymakers were anxious about a global economic slowdown weighing on the economy, which investors took to mean that rates would stay at near-zero levels this year. The Bloomberg Dollar Spot Index was little changed after a four-day decline. Industrials benefit from the weaker currency when their overseas earnings are converted back to dollars, while a lower buck boosts the appeal of dollar-denominated commodities.

“They are actually pretty comfortable with the US economy”. To run this analysis, we break the S&P 500 into deciles (10 groups of 100 stocks each)…We then calculate the average performance of the stocks in each decile since the close on September 29th. Shares of the two rose more than 6.6 percent. Given the concerns regarding inflation perhaps firmer commodity prices would have more impact on the timing of a hike than firmer employment data, which perhaps marks a shift in emphasis of what exactly the FOMC is looking for to justify its shift in policy direction.

The material sector has added 7.8 percent since Monday – its best weekly gain in 2015 and biggest weekly move since 2013, according to IG. Alcoa kicked off the reporting season late Thursday, with sales and profit missing estimates as aluminum prices slumped.

DuPont shares shot up 5.5 percent in after-market trading when the chemical company announced its chief executive was retiring and that it had extended cost cuts. Year-to-date revenue rose 24 percent, generating 21 percent increase in gross margin. The Hawaiian Airlines parent on Wednesday reported a 4.6% increase in September passenger traffic and raised its Q3 outlook. Both were still up more than 12 percent for the week.

Johnson & Johnson (JNJ), Intel ( INTC ), JP Morgan (JPM), Bank of America ( BAC ), General Electric ( GE ), Citigroup ( C ), and Netflix (NFLX) are among the companies due to report their results.

Concordia Healthcare Corp. sank 11 percent, closing at the lowest since December.