XLRE - S&P 500 Reclaims 4500 Oil Hits $90 As Rising Inflation Fails To Dampen Risk Sentiment: What's Driving Markets Thursday? | Benzinga
Thursday witnessed a widespread rally across the spectrum of risk markets, with both equities and commodities surging in response to a slew of economic developments that are progressively dispelling recession concerns.
In August, the Producer Price Index surpassed expectations, following a Consumer Price Index report that was also higher than anticipated.
Remarkably, the renewed upswing in price pressures within the economy is not ruffling the feathers of markets, thanks to the continued robustness of consumer spending. Retail sales among U.S. consumers outstripped forecasts in August, marking a positive streak of five consecutive months of growth.
China made a significant announcement by enacting a 25-basis-point reduction in the reserve requirement ratio for all banks, a move poised to inject much-needed liquidity into the country’s economically challenging situation. The European Central Bank raised rates by 25 basis points but indicated an imminent end to tightening measures, further underpinning the momentum of risk assets.
All S&P 500 sectors were in positive territory, with cyclical sectors such as the Energy Select Sector SPDR Fund (NYSE:XLE), the Materials Select Sector SPDR Fund (NYSE:XLB) and the Real Estate Select Sector SPDR Fund (NYSE:XLRE) leading the way as investors embrace a reflation trade narrative.
Oil prices rallied to a striking $90 per barrel, marking fresh highs for the year and sustaining the upward trajectory of energy and oil giant stocks.
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