US Stocks Reach Highest Levels Since August After House Approves Debt Ceiling Suspension

Wall Street celebrated the approval of the US House of Representatives bill to suspend the debt ceiling, so US stocks rose, and the S&P 500 and Nasdaq indexes recorded their highest levels since August, turning attention to the Senate, which is expected to vote on the legislation before next Monday.

In contrast to the positive news from the Capitol building, the seat of the US Congress, Wall Street benefited from the return of hopes for fixing the interest rate, during the Federal Reserve meetings on June 13 and 14, after statements by experts and bank officials.

During Thursday’s trading, the Dow Jones Industrial Average rose nearly half a percentage point, the S&P 500 added about 1% to its value, while the Nasdaq rose more than 1.25%.

On Wednesday, Philadelphia Fed President Patrick Harker said the central bank needed not to raise interest rates at the next meeting, after they had been raised in the last 10 meetings.

Also, a member of the Federal Reserve Board of Governors, Philip Jefferson, hinted that the US central bank could stop raising interest rates temporarily during its next monetary policy meeting in June, but indicated that this does not mean the end of the series of increases.

Dubbed the “Fiscal Responsibility Act,” legislation to suspend the debt ceiling through 2025 passed Wednesday night, by a vote of 314-117, with bipartisan support. Senate Majority Leader Chuck Schumer said the Senate will remain in session until the bill is sent to President Joe Biden’s desk.

In Europe, stocks rose at the close of trading on Thursday, as data on declining inflation sparked controversy about the need to further raise interest rates beyond this month, and investor sentiment rose as the United States approached avoiding defaulting on its debt, after the House of Representatives approved the legislation. .

The Stoxx Europe 600 index ended the day’s trading up 0.8%, after hitting a two-month low in the previous session.

The commodity, media and energy sectors posted the biggest gains.

Headline and core inflation in the eurozone eased in May, albeit well below expectations, despite recent price hike data from Spain, France and Germany that fell short of expectations and spurred hopes that interest rates would peak in September, rather than December. As indicated by previous forecasts.

Giles Coghlan, chief market analyst at HYCM Investments, said the inflation data was heading in the right direction, lowering expectations that the European Central Bank would raise interest rates more sharply.

Reuters said that François Villeroy de Gallo, Governor of the Bank of France and a member of the European Central Bank, indicated that raising interest rates began to affect inflation, and that the next hike would be marginal, while European Central Bank President Christine Lagarde continued to stress the need for further tightening. Monetary policy.

In a related matter, oil prices rose today, Thursday, by the largest amount in two weeks, ahead of the “OPEC +” meeting scheduled for Sunday, benefiting from the approval of the US House of Representatives on legislation to suspend the debt ceiling, which helped the market overcome the news of rising inventories in the United States.

Brent crude futures rose $1.68, or 2.3%, to settle at $74.28 a barrel. The contracts posted their biggest daily gain in two weeks.

US West Texas crude rose $2.01, or 3%, to settle at $70.10 a barrel, its biggest daily gain in nearly four weeks.

Both indices recovered from the losses of two consecutive sessions, caused by weak industrial activity data from China, the world’s largest importer of black gold.