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U.S. stocks rose Tuesday, boosted by a drop in Treasury yields as Wall Street assessed the geopolitical risks of a protracted conflict from the Israel-Hamas war.
The Dow Jones Industrial Average hovered just above flat. The S&P 500 climbed nearly 0.2%, while the Nasdaq Composite added 0.1%.
The benchmark 10-year Treasury yield was down 8 basis points at 4.694%, as investors turned to the traditional safe haven amid the conflict. These movements reflect the bond market’s first reaction to the Israel-Hamas conflict as it was closed on Columbus Day.
Oil prices also eased after rallying in the previous session. West Texas Intermediate and Brent futures were lower by 0.4% and 0.3%, respectively, on Tuesday.
The decline in yields gave stocks a lift, as Wall Street remains concerned over the recent quick rise in interest rates. Investors may also be looking past the geopolitical risks caused by the conflict, helped by Friday’s stronger-than-expected September payrolls report and optimism ahead of a slew of third-quarter earnings this week.
Hamas’ attack against Israel marks the deadliest offensive in 50 years. At least 900 people in Israel have been killed thus far in what Hamas is calling Operation Al Aqsa Flood, with more than 687 people in Gaza and the West Bank dead in retaliatory Israeli strikes across the Gaza Strip, according to the latest figures. Hamas is a designated terrorist group backed by Iran that has governed the Gaza Strip since 2007.
“It’s a really challenging to want to be an equity investor and U.S. stocks right now,” Billionaire hedge fund manager Paul Tudor told CNBC on Tuesday. “You’ve got the geopolitical uncertainty… the United States is probably in its weakest fiscal position since certainly World War II with debt to GDP at 122%.”
PepsiCo shares rose about 0.7% after the beverage and snack maker reported better-than-expected third-quarter results. The company also raised its earnings outlook.
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