Stock indexes rise with tech shares;  gold extends recent rally amid US rate cut hopes

By Caroline Valetkevitch NEW YORK (Reuters) -Major stock indexes rose on Wednesday as technology shares gained, while gold extended its recent rally above $4,000 an ounce as a prolonged U.S. government shutdown and expectations of further U.S. interest rate cuts drove demand for the safe-haven asset. Gold, which is traditionally seen as a store of value during times of instability, is up about 50% year-to-date, after gaining 27% in 2024. Spot gold was up 1.7% at $4,050.24 per ounce, while U.S. gold futures GCv1 for December delivery also settled 1.7% higher at $4,070.5. Silver also climbed to a record high. Shares of gold miners also rose, including U.S.-listed shares of Gold Fields, up 3.4%. The Japanese yen reached its weakest level since mid-February against the dollar as investors worried about an increase in fiscal spending in Japan, while the euro eased on ongoing political uncertainty in France. On Wall Street, stocks rebounded from Tuesday's declines, with technology shares leading the way higher. Nvidia shares were up 1.9%. "It's rebounding nicely, led by Nvidia and AI-related stocks. It comes down to investors have been optimistic since April, and that optimism continues to be expressed in spite of a government shutdown, a slowing employment market or any other red flags that would normally detract investors," said Oliver Pursche, senior vice president and advisor for Wealthspire Advisors in Westport, Connecticut. Investors have been without most U.S. economic data as the federal government remains shut. Minutes released Wednesday from the last Federal Reserve meeting showed a divided committee, in which policymakers were concerned about rising labor market risks but remained wary of inflation. The central bank is widely expected to cut rates by 25 basis points at its October 28-29 meeting, according to the CME Group’s FedWatch Tool. The Dow Jones Industrial Average rose 16.77 points, or 0.04%, to 46,619.98, the S&P 500 rose 31.71 points, or 0.47%, to 6,746.46 and the Nasdaq Composite rose 197.28 points, or 0.87%, to 22,985.65. MSCI's gauge of stocks across the globe rose 2.84 points, or 0.29%, to 994.97. European shares climbed to record highs, powered by strong gains in French and Spanish stocks. The pan-European STOXX 600 was up 0.8%, closing at its highest level, while French stocks jumped 1.1% and Spanish stocks touched their highest mark since 2007. In France, caretaker Prime Minister Sebastien Lecornu said that he saw a path to forming a new government but that the "final stretch" would be difficult, adding that it was possible France could have a new premier in the next 48 hours. Lecornu, France's fifth prime minister in two years, tendered his and his government's resignation on Monday. The euro was off its earlier lows and last down 0.27% at $1.1623. In Japan, the surprise election of Sanae Takaichi to lead the country's ruling Liberal Democratic Party on Saturday has dented the yen on expectations of greater government stimulus. Against the Japanese yen, the dollar strengthened 0.49% to 152.64. It earlier reached 152.99, the highest since February 14. The yield on benchmark U.S. 10-year notes was flat at 4.127%, from 4.127% late on Tuesday. Oil prices rose. Traders expected a lack of progress on a Ukraine peace deal to keep sanctions in place against Moscow. U.S. crude rose 82 cents to settle at $62.55 a barrel and Brent gained 80 cents to settle at $66.25. (Additional reporting by Amanda Cooper and Joice Alves in London and Ankur Banerjee in Singapore; Editing by Sam Holmes, Sharon Singleton, Emelia Sithole-Matarise, Alexandra Hudson and Diane Craft)

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