NEW YORK, Nov 25 — Major Wall Street indexes notched weekly gains yesterday, as global equities drifted toward their biggest one-month rally since November 2020 during a shortened, muted trading session following the US Thanksgiving holiday.

Oil futures traded steady ahead of next week’s Opec+ meeting, which could bring some kind of agreement on output cuts in 2024.

Gold futures finished higher as the dollar index slipped against a basket of currencies yesterday.

Data showed US business activity held steady in November, but employment in the private sector declined.

MSCI’s index of global shares added 0.12 per cent and headed for a monthly gain of 8.7 per cent after investors grew increasingly confident that US interest rates have peaked, with the market narrative shifting to the timing of cuts.

The Dow Jones Industrial Average rose 117.12 points, or 0.33 per cent, to 35,390.15, the S&P 500 gained 2.72 points, or 0.06 per cent, at 4,559.34 and the Nasdaq Composite dropped 15.00 points, or 0.11 per cent, to 14,250.86.

Europe’s benchmark STOXX 600 gained 0.4 per cent yesterday to close higher for a second straight week, while investors assessed data from Germany for clues about the country’s economic outlook.

Germany’s DAX closed up 0.2 per cent.

In geopolitical news, Israel and Hamas started a four-day ceasefire yesterday and the militants released a group of hostages, the first sign of detente in the near seven-week war.

The US central bank has raised benchmark borrowing costs by more than five percentage points since March 2022 as part of a global monetary tightening cycle.

"Weaker (economic) data and weaker inflation in the US has given markets hope you are going to start to see rate cuts,” said Peter Doherty, investment management director at Arbuthnot Latham in London.

"But the debate is whether we should be taking profits now,” he added, given the potential for a "re-acceleration of US growth,” after the world’s largest economy confounded recession forecasts throughout 2023.

Despite optimism having surged across global markets this month, there may also be a lull ahead as investors position their portfolios for 2024, some analysts said.

US 10-year Treasury yields US10YT=RR, which set the tone for borrowing costs worldwide,rose to 4.485 per cent. They were still comfortably below the 5 per cent milestone reached last month.

Minutes from the latest Fed policy meeting signaled there would not be more hikes unless progress against taming inflation faltered.

S&P Global said its flash US Composite PMI Output Index, which tracks the manufacturing and services sectors, was unchanged at 50.7 as a modest rise in services sector activity offset a contraction in manufacturing. A reading above 50 indicates expansion in the private sector.

The lack of strong order growth resulted in businesses shedding workers, with the survey’s employment index saw its first contraction since June 2020. An easing labour market will aid the Fed’s fight against inflation.

Euro zone government bond yields ticked higher, reflecting pushback from European Central Bank officials against speculation they were ready to start thinking about cutting rates.

ECB policymaker Robert Holzmann, seen as a policy hawk, reiterated that another rate hike was possible, after Belgian policymaker Pierre Wunsch warned about "too optimistic” bets on future cuts.

Germany’s 10-year government bond yield, the benchmark for the euro area, rose 3 basis points to a 1-1/2-week high.

In the UK, where the Bank of England is now viewed as having to keep interest rates at a 15-year high until late next summer, sterling GBP=D3 rose to the highest since early September.

In Asia, Japan’s Nikkei share index climbed, charging back toward a 33-year high hit on Monday.

Data yesterday showed that Japan’s core consumer inflation picked up slightly in October, although by less than expected.

Mainland China’s CSI 300 index dropped 0.7 per cent to its lowest close in more than a month, reflecting investor concern about a property slump and sluggish economy.

Yesterday, foreign investors sold a net 6.2 billion yuan (RM4 billion) of mainland Chinese shares via the stock connect channel, the biggest daily outflow in more than a month.

Oil prices were steady after tumbling more than 1 per cent on concerns over a delayed Opec+ meeting. Brent crude futures settled down 1.03 per cent at US$80.58 per barrel, as US prices finished down 2.02 per cent at US$75.54.

Gold futures settled 0.5 per cent higher at US$2,003. Spot prices gained 0.48 per cent to US$2,001.36 an ounce. — Reuters