U.S. stocks are climbing and Treasury yields are sliding Thursday morning, reversing the declines seen Wednesday after the Federal Reserve raised interest rates for the first time in three years. Investors appear to be shaking off the initial reaction to the policy shift, which included a quarter percentage point increase and signals of further hikes later this year.
In early trading, the S&P 500 index rose by 1%, while the Nasdaq gained even more ground. The 10-year Treasury yield dropped below 5%, and the Wall Street Journal dollar index retreated following its jump on Wednesday. This movement marks a quick turnaround from Wednesday's session, when both stocks and bonds stumbled following the Fed's decision.
Analysts have pointed to oil prices as a factor contributing to the lower bond yields. Brent crude futures fell by 3% to trade below $103 a barrel, down from levels that topped $109 earlier in the week. This decline comes on hopes that disruptions to exports via a damaged Saudi pipeline may not be as severe as initially feared.
In other central banking developments, the Bank of England held its rates steady, a move that broke with its peers.