The S&P 500 climbed 0.9% and the tech-heavy Nasdaq 100 closed at its highest level since Sept. 19. While stocks soared for most of Tuesday’s session, it gave back some of its gains after an Associated Press report cited an unidentified U.S. intelligence official as saying that Russian missiles had landed in NATO-member Poland. Commodities from oil to corn also rose on geopolitical concerns from Europe. While Poland later said an explosion near its eastern border with Ukraine killed two people, it did not confirm the Associated Press report. Markets have turned risk on in recent days, trading in a softer-than-expected US consumer price index that many believe will allow the Fed to raise interest rates in half-point increments. While a series of Fed speakers in recent days indicated that officials could slow their pace, they also stressed that the central bank has more work to do to tame inflation. On Tuesday, the producer price index for October came in at 8 percent year-on-year, downgrading the estimate of 8.3 percent and further easing inflation concerns.
But some investors aren’t convinced the recent data will do much to cheer the Fed. “Markets appear to be pricing in a scenario of a soft landing and falling inflation that triggers a Fed pause,” said Venu Krishna, head of U.S. equity strategy at Barclays Plc. “In our view, this is not a given and remains a low-probability scenario – these are just a few data points on inflation and should be preserved. Even if the Fed eventually stops, it may not be able to prevent a shallow recession.” Key events this week:

US business inventories, cross-border investment, retail sales, industrial production, Wednesday Fed’s John Williams, Lael Brainard and SEC Chairman Gary Gensler speak, Wednesday ECB president Christine Lagarde speaks on Wednesday Eurozone CPI, Thursday US housing starts, initial jobless claims, Thursday The Fed’s Neel Kashkari, Loretta Mester, Thursday speak Leading US Conference Board index, existing home sales, Friday

Some of the main movements in the markets:

inventories

The S&P 500 was up 0.9% at 4 p.m. New York time The Nasdaq 100 rose 1.5%. The Dow Jones Industrial Average rose 0.2%. The MSCI World Index fell 0.6%.

currency

The Bloomberg Dollar Spot Index fell 0.3%. The euro gained 0.3 percent to US$1.0353 The British pound rose 0.9 percent to US$1.1863 The Japanese yen rose 0.5 percent to 139.21 yen per dollar

Cryptocurrencies

Bitcoin rose 2.6 percent to US$16,816.92 Ether rose 2.1 percent to US$1,251.32

Bindings

The yield on the 10-year note fell seven basis points to 3.78 percent Germany’s 10-year yield fell four basis points to 2.11%. Britain’s 10-year yield fell seven basis points to 3.29%.

Goods

West Texas Intermediate crude rose 0.9 percent to US$86.67 a barrel Gold futures rose 0.3% to $1,782.70 an ounce