U.S stocks rose as Federal Reserve minutes reflected caution over raising interest rates even as the economy improves, further boosting commodity producers.
The minutes kept expectations for higher rates pushed into next year, weakening the dollar and boosting energy, raw-material and industrial companies amid speculation that a weaker U.S. currency will lift their profits. Those three industry groups rallied at least 1.4 percent Thursday.
The Standard & Poor’s 500 Index added 0.9 percent to 2,013.40 at 4 p.m. in New York, rising above a level where recent rallies had stalled.
The Fed’s decision on September 17 to not raise interest rates jolted investors, as the central bank cited global market turmoil and a slowdown in China as reasons for standing pat. Equities slid in seven of eight sessions after the meeting, with the S&P 500 losing 5.7 percent.
Commodity producers and industrial shares have had their strongest rallies in years while the dollar has slumped since the weaker-than-forecast September jobs report set back expectations for higher rates. The Bloomberg Dollar Index is headed toward a three-week low. Industrials benefit from the weaker currency when their overseas earnings are converted back to dollars, while commodities denominated in a lower U.S. currency are more attractive.
A report today showed filings for unemployment benefits declined last week to the lowest level since mid-July, extending a run of applications near decade lows that shows dismissals remain in check. Managers are reluctant to trim staffing levels because domestic demand is holding up in the face of diminished global growth expectations.