U.S. stocks continue to rise significantly, long-term interest rates have slowed down as expectations for a Fed rate hike increase

[New York Current Affairs] While many expect the US Federal Reserve Board (FRB) to raise interest rates at its policy meeting on the 15th and 16th, in the US financial market on the 11th over the weekend, long-term interest rates paused and stock prices rose sharply due to expectations of inflation control through tightening. Raising interest rates is usually negative for business activity, but there is a widespread bullish stance that growth, centered on the artificial intelligence (AI) industry, will continue.

U.S. price indicators released this week showed the persistence of inflation, strengthening the view in the market that interest rate hikes are inevitable. Fed Chairman Steve Warsh's speech at the end of August was seen as suggesting a rate hike, leading experts to say, ``If we don't act, we won't be able to maintain consistency with what we've said,'' said Tsubasa Fujiwara, a researcher at the Daiwa Institute of Research.

On the 11th, the yield on two-year bonds, which tends to reflect the outlook for policy interest rates, rose 0.06% from the previous day's close of trading. Meanwhile, the 10-year bond yield, which is an indicator of long-term interest rates and has a strong correlation with inflation expectations, briefly approached the 5% mark, but quickly began to decline.

In the stock market, a wide range of stocks were bought as ``long-term interest rates have stabilized, creating a sense of security'' (Japanese Securities). The Dow Jones Industrial Average, which is made up of blue-chip stocks, closed at $52,573.29, up $509.19 from the previous day's closing price. Stocks related to AI and semiconductors attracted buying interest.