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Timothy Fadek | Bloomberg | Getty Images
An employee analyzes a customer's purchases at a Walmart Inc. store in Secaucus, New Jersey, United States on Wednesday, May 16, 2018.
The upward recovery from corporate earnings was, however, offset by growing investor uncertainty over rising interest rates and a strong federal reserve that verified key indices.
Billionaire hedge fund billionaire Ray Dalio told CNBC on Thursday that, despite the gradual rise in interest rates, the Fed had already damaged the price of assets.
"We have raised interest rates to a level that hurts asset prices," said Bridgewater Associates founder in an interview with CNBC's "Squawk Box." "We are currently in a situation where the Fed will have to look at asset prices before looking at economic activity – it's a tough position."
Fed Chairman Jerome Powell touted the strength of the US economy on Wednesday night, saying markets should adjust to the idea that the central bank could raise interest rates anytime from next year. Although Powell acknowledged that while the global economy was not as strong as last year, he added that domestic economic growth still seemed strong.
The 10-year Treasury yield fell to 3.081% on Thursday. Bond yields rise with falling prices.
The US central bank has raised its overnight funding rate three times since the beginning of the year and is expected to do so again in December. Investors tend to view higher interest rates as a threat to earnings growth and a barrier for highly leveraged companies.
"I am very happy with the current economic situation," he said in an interview with Dallas Fed President Robert Kaplan. "Our policy is one of the reasons our economy is doing so well right now."
Around the world, sentiment has improved over reports that China has provided a written response to US trade requests. US government sources told Reuters on Wednesday that China has responded to US demands for ongoing trade talks, giving investors hope that both sides could end the crisis.
Concerns about oversupply in the oil markets continue to dominate the market. On Thursday, oil prices stabilized as Brent crude oil futures in the first month traded at $ 66.78 a barrel, up 63 cents or 0.95% from the previous month. their last closing. The futures price of the WTI (West Texas Intermediate) US crude was $ 56.72 per barrel.
The pound plunged more than 1.4% against the dollar on Thursday morning after the resignation of its secretary, Dominic Raab, Secretary of the British Brexit. This puts further pressure on British Prime Minister Theresa May, who is trying to get Parliament's draft agreement on Brexit passed.
Initial claims for state unemployment benefits increased from 2,000 to 216,000 seasonally adjusted for the week ended Nov. 10, the Department of Labor said Thursday. Retail sales increased 0.8%, exceeding the expected 0.5%.
– CNBC
Spriha Srivastava
Contributed reports.
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