U.S. Stocks, Bonds Jump on Go-Slow Fed; Oil Climbs: Markets Wrap

U.S. stocks rose toward records, Treasuries rallied and the dollar retreated after Janet Yellen signaled the Federal Reserve won’t rush to tighten monetary policy as inflation remains persistently below target. The Dow Jones Industrial Average closed at a fresh all-time high, technology shares added more than 1 percent and emerging-market equities surged to levels last seen in 2015 as Yellen expressed confidence in the American economy while suggesting inflation rates won’t force the Fed’s hand. The dollar fell versus most major peers, 10-year Treasury yields slid below 2.32 percent and gold futures rose. Oil bounced above $45 a barrel. The Brazilian real strengthened after former President Luiz Inacio Lula da Silva was convicted of graft and money-laundering, while Canada’s dollar rallied on central bank tightening. The statement from Yellen diverted attention from the release of emails by Donald Trump Jr. about his controversial meeting with a Russian lawyer, though concern remains that the latest saga in Washington may be an unwelcome distraction for the Fed seeking to dismantle a decade of monetary stimulus. The Fed chair made no mention of asset prices just a week after her comment that some looked “somewhat rich” added to selling in stocks and bonds. Yellen’s dovish tone came as the Bank of Canada raised interest rates for the first time in seven years even as inflation in the country remains stubbornly sluggish. Central banks around the world have been hinting that the accommodative policies in place for years may no longer be needed amid signs that the global economy is gaining traction.

More great economic news in this Trump era.  Making America great again!   🙂

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