Wall Street pointed toward early gains Thursday after the U.S. Federal Reserve indicated it may not need to pump the brakes any harder on the economy.
Futures for the Dow Jones industrials rose 0.4% before the bell and the S&P 500 ticked 0.6% higher.
Fed Chair Jerome Powell said Wednesday that the central bank is unsure that its main interest rate is high enough to ensure high inflation will move down to its 2% target. That kept alive the possibility of more hikes by the Fed. He also said the Fed is not considering cuts to interest rates, which can act like steroids for financial markets.
But Powell acknowledged that a recent run higher in longer-term Treasury yields, and the tumble in stock prices that helped cause, are working on their own to slow the economy and could be starving high inflation of its fuel. If they can do that persistently, he indicated they could help the Fed whip inflation without requiring more rate hikes.
More corporate earnings and mergers are driving markets higher as well.
Starbucks climbed more than 5% before the bell Thursday posting record fourth quarter revenue. The Seattle coffee giant opened 816 new stores in the period, giving it more than 38,000 stores worldwide.
Clorox shares jumped almost 12% after the bleach maker easily beat Wall Street profit targets and PayPal rose 6.5% on its strong quarterly results.
Apple reports after the bell Thursday.
Also on Thursday, Cedar Fair and Six Flags said they’l merge to create an expansive amusement park operator with operations spread across 17 U.S. states and three countries. Shares of both companies are up more than 9% this week after rumors of the deal spread.
The government’s weekly jobless claims report comes later Thursday, followed by its comprehensive October jobs report on Friday.
Earlier this week, the Labor Department reported that U.S. employers posted 9.6 million job openings in September, up from 9.5 million in August and further evidence that the labor market has effectively shrugged off the Fed’s aggressive interest rate hikes.
Elsewhere, in Europe at midday France’s CAC 40 rose 1.9%, Germany’s DAX gained 1.6% and Britain’s FTSE 100 climbed 1.2%.
In Asian trading, Japan’s benchmark Nikkei 225 gained 1.1% to finish at 31,949.89.
In Japan, Prime Minister Fumio Kishida announced an economic stimulus package worth about $113 billion that is meant to cushion the blow to household budgets from rising inflation and timed to counter weakening public support for his government. The package includes tax breaks for individuals and companies and subsidies to reduce rising energy costs.
Australia’s S&P/ASX 200 jumped 0.9% to 6,899.70. South Korea’s Kospi surged 1.8% to 2,343.12.
Hong Kong’s Hang Seng added 0.8% to 17,230.59.
But the Shanghai Composite fell 0.5% to 3,009.41 after the central bank reported a decline in property loans, the first such drop since 2005.
In energy trading, benchmark U.S. crude added $1.23 to $81.67 a barrel in electronic trading on the New York Mercantile Exchange. Brent crude, the international standard, gained $1.25 to $85.88 a barrel.
The U.S. dollar edged down to 150.36 Japanese yen from 150.96 yen. The euro cost $1.0633, up from $1.0570.
On Wednesday, the S&P 500 rose 1.1% and the Dow industrials gained 0.7%. The Nasdaq composite jumped 1.6%.
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