Wall Street jumps, oil lower ahead of Fed vote next week

Wall Street ticked up on Friday after a volatile, mostly down week and oil prices dipped after a week-long surge in which Gulf tensions and inflation concerns weighed on markets. Oil prices retreated from a four-month high on Friday, but accelerating U.S. consumer inflation boosted expectations for an interest rate hike from the Federal Reserve next week, keeping bond yields elevated. All three major U.S. indices were higher on Friday but still on track for a weekly loss. The Dow Jones Industrial Average .DJI rose 1.13%, the S&P 500 .SPX gained 1.03% and the Nasdaq Composite .IXIC was up 1.15%. MSCI's gauge of stocks across the globe .MIWD00000PUS rose 5.66 points, or 0.50%. Brent crude LCOc1 hit a four-month high of $109.97 a barrel on Friday after a 6% jump the day before, but it soon ran into selling pressure and was last down about 2.9% at $104.49. It was still set for a weekly rise of over 8%. Oil flows remained restricted through the Strait of Hormuz as the United States and Iran traded attacks, although prices have fallen since the Financial Times reported that foreign ministers in the Middle East were trying to work out a temporary deal to manage shipping through the waterway. Markets are still pricing in the risk of a protracted war. Comments by President Donald Trump that the war could last beyond the November midterm elections have not helped, with bond yields surging globally on heightened inflation fears. Gold rose 0.8% to $4,350 an ounce XAU= after dropping nearly 2% on Thursday. The Consumer Price Index increased 0.4% last month after edging up 0.1% in July, the U.S. Labor Department's Bureau of Labor Statistics said. Traders were quick to add to bets for a rate hike from the Fed at its two-day meeting next week. Markets now see about an 85% chance of a quarter-point hike, compared with around 67% prior to the data. The Fed will release its latest policy statement on Wednesday, followed by a press conference with Chairman Kevin Warsh. "Thus far, the Fed has simply stared at inflation with its withering gaze. (Friday's) report will probably change that," said Shawn Snyder, economic strategist at Potomac Fund Management. "It may not be enough to definitively push the Fed to hike rates at its September meeting, but with oil prices hovering around $100 a barrel, it is hard to envision the inflation outlook getting much better in the near term." The benchmark 10-year Treasury yield US10YT=RR was slightly higher on Friday at 4.96%, helped by retreating oil prices. It briefly touched its highest in almost three years at 4.9915% immediately after the inflation data. The U.S. dollar was flat, having gained 0.4% on Thursday against its major peers. It =USD was steady on Friday at 99.1.

Wall Street jumps, oil lower ahead of Fed vote next week

Wall Street rises after volatile week

Oil eases from highs as Strait of Hormuz tensions persist

Inflation data lifts Fed rate-hike bets and keeps yields high

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