Stocks gain moderately, led by high-dividend sectors

Japan’s Nikkei dipped 0.3 percent, reflecting the yen’s gains during Japan’s market holiday on Thursday. But with lowered expectations for an imminent rate hike, the spread, or gap, between 2- and 10-year muni bond yields fell from 1.086 percent to 1.024 percent, its lowest level since July 8.

The S&P 500 was up 15.01 points, or 0.69 percent, at 2,178.13.

The S&P energy index surged 1.33 percent and was the top gainer among the 11 major sectors of the benchmark index. After hesitating or worrying that the Federal Reserve will raise interest rates, investors piled into high-dividend stocks after the Fed decided yet again to leave rates unchanged.

“Because the Fed is shying away from tightening, there will be liquidity sloshing around in the world’s financial markets as well for another few months”, said Tatsushi Maeno, senior strategist at Okasan Asset Management.

The Fed announced it will continue to stand pat on interest rates until it believes the USA economy is strong enough to support an increase.

USA crude prices settled down 4 percent on signs Saudi Arabia and arch rival Iran were making little progress toward a preliminary agreement ahead of talks by major crude exporters next week aimed at freezing production.

The 30-year bond yield touched its lowest level in two weeks Friday following the central bank’s September 21 decision to refrain from raising rates and reduce the number of hikes it expects next year.

“It’s hard to get too excited about the dollar when the Fed is lowering its projected path of rate hikes into the future”.

SAN FRANCISCO The split at the Federal Reserve over when to next raise interest rates appears to hinge largely on disagreements over the labor market outlook, comments from policymakers on Friday suggest. USA gold futures slipped 0.4 percent to $1,339 an ounce.

The German Bunds yield also fell about 10 basis points to minus 0.093 percent from plus 0.005 percent on Wednesday.

One weak spot was Jabil Circuit, which dropped almost 6 percent to $22.34 after the contract electronics maker said it meant to realign its business at a cost of $195 million over two years. “I just feel like the market is going to keep grinding higher”.

Friday’s pause in gains for precious metals, including silver, comes as the dollar was trading flat in a week that sees the greenback on pace for a 0.6% weekly decline, as gauged the ICE U.S. Dollar Index DXY, +0.16% a measure of the buck’s performance against six major rivals.

The euro fetched $1.1197, recovering from Wednesday’s three-week low of $1.1123.

Higher interest rates make currencies more attractive to investors. Brent crude, used to price worldwide oils, rose 82 cents to $47.65 a barrel.

Traders may also keep an eye on remarks by several Fed officials on the heels of the closely watched monetary policy announcement earlier this week. Palladium was down 0.5 per cent at $690.20, after rising 1.5 per cent on Thursday.