(Reuters) – Elon Musk’s artificial intelligence startup xAI will release its first AI model to a select group on Saturday, the billionaire and Tesla CEO said on Friday.

This comes nearly a year after OpenAI’s ChatGPT caught the imagination of businesses and users around the world, spurring a surge in adoption of generative AI technology.

Musk co-founded OpenAI, the company behind ChatGPT, in 2015, but stepped down from the company’s board in 2018.

“In some important respects, it (xAI’s new model) is the best that currently exists,” he said on Friday.

The billionaire who has been critical of Big Tech’s AI efforts and censorship said earlier this year that he would launch a maximum truth-seeking AI that tries to understand the nature of the universe to rival Google’s Bard and Microsoft’s Bing AI.

The team behind xAI, which launched in July this year, comes from Google’s DeepMind, the Windows parent, and other top AI research firms.

Though Musk-owned X, the social media firm formerly known as Twitter, and xAI are separate, the companies work closely together. XAI also works with Tesla and other companies.

Larry Ellison, co-founder of Oracle and a self-described close friend of Musk, said in September that xAI had signed a contract to train its AI model on Oracle’s cloud.

(Reporting by Akash Sriram in Bengaluru; Editing by Shinjini Ganguli)

(Refiles with GLOBAL MARKETS in headline; no changes to text)

By Harry Robertson and Tom Westbrook

LONDON/SINGAPORE (Reuters) – Global stocks were on track for their biggest weekly rise in a year on Friday as investors cheered a pause in U.S. interest rate hikes, while the dollar was on the back foot.

Trading on Friday was relatively subdued, however, as investors awaited key U.S. employment data later in the day.

The MSCI World stock index has risen 4.3% since Monday, which would be the largest weekly rise since November 2022. The index was up 0.23% on the day.

Europe’s benchmark Stoxx 600 equity index was 0.16% higher on Friday and was set for a weekly increase of 3.4%, its biggest since March. Germany’s DAX was 0.18% higher and Britain’s FTSE 100 rose by the same amount.

The rally in stocks came as bond yields tumbled after the Fed left interest rates steady for a second meeting running on Wednesday and the Bank of England followed suit on Thursday.

Central bank officials stressed that more may need to be done to tackle inflation, but many investors believe the next move in borrowing costs is likely to be down.

“What you hear from basically all the major central banks over the last week…, in their mind I think they’re all on hold,” said Samuel Zief, head of global FX strategy at JPMorgan Private Bank. The European Central Bank held rates last week.

“Once the market can become convinced that all these central banks are on hold…, that can encourage bond yields to move lower.”

The 10-year U.S. Treasury yield, the reference for borrowing rates around the world, dropped 20 basis points (bps) over Wednesday and Thursday and is now down around 36 bps since touching a 16-year high above 5% last week.

The yield, which moves inversely to the price, was unchanged at 4.666% on Friday.

A decision on Wednesday by the U.S. Treasury to issue less long-term debt than expected also fuelled the rally in bonds, as did data on Thursday suggesting the U.S. economy might finally be cooling.

The dollar index was down 0.16% at 106.03 on Friday and on track to fall 0.49% across the week, dragged lower by U.S. yields. The euro was up 0.15% at $1.064 and set for a 0.69% weekly gain.

U.S. S&P 500 stock index futures were 0.2% lower on Friday, pointing to a slight fall at the open after the index jumped 1.9% the previous day.

Apple’s Frankfurt-listed shares fell 2.3% after it delivered a sales forecast for the holiday quarter that missed Wall Street expectations. It was down around 3% in pre-market U.S. trading.

Investor focus on Friday turned to the U.S. nonfarm payrolls data due at 1230 GMT (8.30 a.m. ET). Economists expect the U.S. economy added 180,000 jobs in October, after the blockbuster 336,000 increase in September.

Goldman Sachs chief economist Jan Hatzius wrote in a note to clients that the bank expects payrolls rose by 195,000, despite a 30,000-job drag from the autoworker strikes.

“We believe tight labor markets incentivize firms to frontload autumn and pre-holiday hiring,” he said.

Oil prices were down for the week, in part because the Israel-Hamas war has not widened as some feared.

Brent crude oil futures were 3.8% lower since Monday at $87.04 a barrel, while U.S. crude traded at $82.67 a barrel, although both were up slightly on Friday.

Sam Bankman-Fried, founder of the collapsed crypto exchange FTX, was found guilty of stealing from customers on Thursday. There was no obvious market reaction, leaving bitcoin to hold steep recent gains at $34,269.

(Reporting by Harry Robertson in London and Tom Westbrook in Singapore; editing by Jacqueline Wong, Miral Fahmy and Mark Heinrich)

(Reuters) -Rapid advances in artificial intelligence (AI) such as Microsoft-backed OpenAI’s ChatGPT are complicating governments’ efforts to agree laws governing the use of the technology.

Here are the latest steps national and international governing bodies are taking to regulate AI tools:

AUSTRALIA

* Planning regulations

Australia will make search engines draft new codes to prevent the sharing of child sexual abuse material created by AI and the production of deepfake versions of the same material.

BRITAIN

* Planning regulations

Leading AI developers agreed on Nov. 2 to work with governments to test new frontier models before they are released to help manage the risks of the developing technology, in a “landmark achievement” at the first global AI Safety Summit in Britain.

More than 25 countries present at the summit, including the U.S. and China, as well as the EU, on Nov. 1 signed a “Bletchley Declaration” saying countries needed to work together and establish a common approach on oversight.

Britain said at the summit it would triple to 300 million pounds ($364 million) its funding for the “AI Research Resource”, comprising two supercomputers which will support research into making advanced AI models safe.

Prime Minister Rishi Sunak on Oct. 26 said Britain would set up the world’s first AI safety institute to “understand what each new model is capable of, exploring all the risks from social harms like bias and misinformation through to the most extreme risks”.

Britain’s data watchdog said on Oct. 10 it had issued Snap Inc’s Snapchat with a preliminary enforcement notice over a possible failure to properly assess the privacy risks of its generative AI chatbot to users, particularly children.

CHINA

* Implemented temporary regulations

Wu Zhaohui, China’s vice minister of science and technology, told the opening session of the AI Safety Summit in Britain on Nov. 1 that Beijing was ready to increase collaboration on AI safety to help build an international “governance framework”.

China published proposed security requirements for firms offering services powered by generative AI in October, including a blacklist of sources that cannot be used to train AI models.

The country issued a set of temporary measures in August, requiring service providers to submit security assessments and receive clearance before releasing mass-market AI products.

EUROPEAN UNION

* Planning regulations

European lawmakers agreed on Oct. 24 on a critical part of new AI rules outlining the types of systems that will be designated “high risk”, inching closer to a broader agreement on the landmark AI Act which is expected in December, according to five people familiar with the matter.

European Commission President Ursula von der Leyen on Sept. 13 called for a global panel to assess the risks and benefits of AI.

FRANCE

* Investigating possible breaches

France’s privacy watchdog said in April it was investigating complaints about ChatGPT.

G7

* Seeking input on regulations

The Group of Seven countries agreed on Oct. 30 to an 11-point code of conduct for firms developing advanced AI systems, which “aims to promote safe, secure, and trustworthy AI worldwide”.

ITALY

* Investigating possible breaches

Italy’s data protection authority plans to review AI platforms and hire experts in the field, a top official said in May. ChatGPT was temporarily banned in the country in March, but it was made available again in April.

JAPAN

* Investigating possible breaches

Japan expects to introduce by the end of 2023 regulations that are likely closer to the U.S. attitude than the stringent ones planned in the EU, an official close to deliberations said in July.

The country’s privacy watchdog has warned OpenAI not to collect sensitive data without people’s permission.

POLAND

* Investigating possible breaches

Poland’s Personal Data Protection Office said in September it was investigating OpenAI over a complaint that ChatGPT breaks EU data protection laws.

SPAIN

* Investigating possible breaches

Spain’s data protection agency in April launched a preliminary investigation into potential data breaches by ChatGPT.

UNITED NATIONS

* Planning regulations

The U.N. Secretary-General António Guterres on Oct. 26 announced the creation of a 39-member advisory body, composed of tech company executives, government officials and academics, to address issues in the international governance of AI.

The U.N. Security Council held its first formal discussion on AI in July, addressing military and non-military applications of AI that “could have very serious consequences for global peace and security”, Guterres said at the time.

U.S.

* Seeking input on regulations

The U.S. will launch an AI safety institute to evaluate known and emerging risks of so-called “frontier” AI models, Secretary of Commerce Gina Raimondo said on Nov. 1 during the AI Safety Summit in Britain.

President Joe Biden issued a new executive order on Oct. 30 to require developers of AI systems that pose risks to U.S. national security, the economy, public health or safety to share the results of safety tests with the government.

The U.S. Congress in September held hearings on AI and an AI forum featuring Meta CEO Mark Zuckerberg and Tesla CEO Elon Musk. More than 60 senators took part in the talks, during which Musk called for a U.S. “referee” for AI.

The U.S. Federal Trade Commission opened in July an investigation into OpenAI on claims that it has run afoul of consumer protection laws.

(Compiled by Alessandro Parodi and Amir Orusov in Gdansk; editing by Milla Nissi)

A look at the day ahead in U.S. and global markets from Mike Dolan

Markets are betting central banks are done hiking interest rates, inflation is falling and corporate earnings are robust – and they now have just one more hurdle to clear to complete what’s set to be the best week of 2023.

The U.S. October employment report out later on Friday caps a hectic two weeks of central bank decisions, company updates and unnerving geopolitics. As the first major marker of U.S. economic strength in the final quarter of the year, the payrolls report packs a punch despite expected strike-related distortions.

Following a soft private sector jobs reading earlier in the week and a tick higher in weekly jobless claims, employment growth is expected to have slowed to some 180,000 new payrolls from 336,000 in September.

In the light of Thursday’s surge in stocks and bonds – based largely on an assumption the Federal Reserve, European Central Bank and Bank of England have now ended their rate hike campaigns – signs of a cooling labor market may be welcomed.

In advance of the release, S&P500 futures stepped back a bit from Thursday’s highs when the cash index boasted its biggest one-day gain since April by adding almost 2%. Even the small cap Russell 2000 jumped 2.7% in its biggest gain since June.

Part of the hesitancy is down to an underwhelming third quarter update from America’s most valuable firm Apple, whose stock fell 3% in out-of-hours trade ahead of Friday’s open after its sales forecast for the holiday quarter missed Wall Street estimates despite a third-quarter profit beat.

And while S&P500 aggregate annual earnings growth for Q3 is tracking an impressive 5%, LSEG data shows Wall Street has downgraded fourth-quarter earnings growth estimates to 7.2%, down from 11% just before the reporting season began.

The interest rate relief this week is pervasive, however, as the Fed, ECB and BoE all paused tightening and U.S. Treasury debt sales worries ebbed somewhat.

Ten-year U.S. Treasury yields have recoiled almost 30 basis points from Wednesday’s highs to sit at 4.66% – and are on course for their biggest weekly drop since March.

U.S. Treasury and equity market volatility gauges have subsided to their lowest levels since early last month.

What’s more, other incoming economic numbers underlined a reason for renewed market optimism after a torrid few months.

Labor Department statistics showed worker productivity grew faster than forecast in Q3 as labor costs declined — recording its quickest pace in three years. If sustained, that should help the Fed’s efforts to bring inflation back to target and may also reflect investment in technology and artificial intelligence.

Elsewhere, Chinese stocks also caught a bid at last after a survey showed services activity improved slightly last month, even though new orders rose at their slowest in 10 months and employment stagnated.

U.S. service sector readings are also due later on Friday.

The dollar held steady ahead of the payrolls release.

With U.S. Secretary of State Antony Blinken in Isreal seeking a pause in the Gaza war as Israeli troops surround Gaza City, investors will likely keep a wary eye on the conflict there as the weekend nears.

And the crypto world may well take a deep breath after FTX founder Sam Bankman-Fried was late Thursday found guilty of stealing from customers of his now-bankrupt cryptocurrency exchange in one of the biggest financial frauds on record.

Key developments that should provide more direction to U.S. markets later on Friday:

* U.S. Oct employment report, ISM and S&P Global Oct U.S. service sector surveys; Canada Oct employment report

* U.S. corporate earnings: Eversource Energy, Sempra, Cardinal Health, Dominion Energy, Gartner, Church & Dwight, AMC, Liberty Media, Icahn Enterprises, Silvercrest

* Federal Reserve Vice Chair for Supervision Michael Barr, Minneapolis Fed President Neel Kashkari speak; Bank of England chief economist Huw Pill speaks

* U.S. Secretary of State Antony Blinken visits Israel

(By Mike Dolan, editing by Emelia Sithole-Matarise; [email protected]. Twitter: @reutersMikeD)

(Reuters) – U.S. stock index futures slipped on Friday, pressured by a drop in Apple shares following a dour holiday-quarter forecast, while investors awaited a crucial employment report for more cues on the interest rate trajectory.

Apple tumbled 3.3% in premarket trading after its sales forecast for the current quarter fell short of Wall Street expectations, even as an uptick in iPhone sales and strong services revenue lifted fourth-quarter results above estimates.

Other megacap growth stocks were mixed, with the benchmark 10-year Treasury yield steady at 4.67% after dropping to a three-week low in the previous session.

“The only thing that could save Apple from falling into dark waters is… a further rally in U.S. bonds, and a further fall in yields,” said Ipek Ozkardeskaya, senior analyst at Swissquote Bank.

Wall Street’s main indexes rallied on Thursday, with the S&P 500 logging its biggest one-day percentage gain since April on growing optimism that the Federal Reserve had reached the end of its monetary tightening campaign.

All three major indexes are tracking their biggest weekly gain in about a year.

Investors are focused on the Labor Department’s report, due at 8:30 a.m ET (12:30 GMT), which is expected to show U.S. job growth likely slowed last month, partly due to the strike against the Detroit Big Three automakers.

Economists polled by Reuters expect non-farm payrolls to have increased by 180,000 jobs in October, after surging 336,000 in September, with the unemployment rate seen steady at 3.8%.

The reading, which will come on the heels of a mixed set of data on the labor market this week, could bolster the view that the U.S. central bank need not raise interest rates further. But analysts have cautioned that a stronger-than-expected report may bring concerns about interest rates back to the fore.

“Any strength in job additions or wages growth data could bring bond trades back to earth and remind them that if the US jobs market – and the economy – remains this strong, the Fed could turn hawkish again,” said Ozkardeskaya.

At 5:12 a.m. ET, Dow e-minis were down 10 points, or 0.03%, S&P 500 e-minis were down 8.25 points, or 0.19%, and Nasdaq 100 e-minis were down 60 points, or 0.4%.

Among major movers, Fortinet dropped 23.3% premarket as the cybersecurity firm forecast fourth-quarter revenue below Wall Street estimates.

Coinbase shares fell 3% after the cryptocurrency exchange’s trading volumes declined for the second quarter in a row.

Block jumped 18.4% after the payments firm raised its annual adjusted profit forecast.

(Reporting by Amruta Khandekar; Editing by Sriraj Kalluvila)

LONDON (Reuters) – The United Nations food agency’s world price index fell in October to its lowest level in more than two years, driven by declines in sugar, cereals, vegetable oils and meat.

The Food and Agriculture Organization’s price index, which tracks the most globally traded food commodities, averaged 120.6 points in October, down from 121.3 for the previous month, the agency said in a report on Friday.

The October reading was the lowest since March 2021.

The FAO Cereal Price Index averaged 125.0 points, down 1.3 points from September.

“International wheat prices fell by 1.9% in October, reflecting generally higher-than-earlier-anticipated supplies in the United States of America and strong competition among exporters,” the FAO said.

Dairy bucked the downward trend in prices with the FAO index rising 2.4 points to 111.3 points following nine months of consecutive declines.

“World milk powder prices increased the most, principally driven by surges in import demand…especially from Northeast Asia,” the FAO said.

In a separate report on cereal supply and demand, the FAO maintained its forecast for world cereal production this year at 2.819 billion metric tons, up 0.9% from the previous year.

“Turning to 2024, winter wheat plantings are underway across the northern hemisphere and area growth is expected to be limited, reflecting softer crop prices this year,” the FAO said.

Its report said that in Ukraine the continuing effects of the war with Russia, including constrained access to fields and low farm-gate prices, along with less-than-ideal weather conditions, are seen leading to a reduction in the wheat area.

The FAO also said sowing of the 2024 coarse grain crops was underway in the southern hemisphere.

“In Brazil, early indications point to a pullback in maize plantings of around 5%, as cost-price ratios are favouring soybeans,” the report said.

(Reporting by Nigel Hunt; Editing by Tomasz Janowski and Mark Heinrich)

By Victoria Waldersee

BERLIN (Reuters) -BMW reported a higher third-quarter margin in its core cars business on Friday, striking a more optimistic tone than some competitors as it confirmed forecasts for the year.

The premium carmaker has forecast an annual margin on earnings before interest and taxes (EBIT) in its cars division of 9.0%-10.5% and is on course to hit that target with a 10.3% margin so far this year, it said.

Higher-priced and fully electric cars boosted quarterly revenues above expectations of eight analysts polled by LSEG to 38.5 billion euros ($40.92 billion), but group net profit fell 7.7% after last year’s figure benefited from a one-off boost when BMW took majority control of its Chinese joint venture.

The company saw some slight relief in raw material prices in the quarter versus last year but nonetheless felt an impact of 200 million euros from the net balance of currency and raw material positions, Chief Financial Officer Walter Mertl said.

Materials and logistics costs remain high, with a notable negative impact across the first nine months of 2023 due to factors including high labour costs from partners, he added.

BMW’s EBIT margin was 9.8% in the quarter, rising to 10.8% excluding the impact of last year’s decision to take majority control of Chinese joint venture BMW Brilliance Automotive.

The German group has maintained a cautiously optimistic tone through the year, and raised its automotive margin outlook in August.

In a statement, it made no mention of high interest rates or inflation weighing on growth, in contrast to competitors such as Mercedes-Benz and Porsche, which warned of a subdued market environment curbing demand.

Supply chain issues had eased, BMW added, after warning in August they could continue throughout the year. Sales this year were up 5.1% so far.

Fully electric sales hit 15.1% of total sales in the third quarter, outstripping BMW’s end-year target of 15%. Models from the upper price segment, like the 7 Series, the updated BMW X7, and the BMW X5 and BMW X6 models, are also driving sales growth.

Free cash flow for the automotive business so far this year came in at 5.7 billion euros, near the full-year forecast of 6 billion.

($1 = 0.9409 euros)

(Reporting by Victoria Waldersee; Editing by Elaine Hardcastle and Mark Potter)

(Reuters) – Investors channelled substantial sums into global money market funds in the week leading to Nov. 1, seeking the safety of these assets ahead of pivotal policy decisions from the world’s leading central banks.

The move towards money markets underscored a broader sense of caution as markets braced for the U.S. Treasury Department’s update on financing requirements against a backdrop of an expanding budget deficit.

Investors pumped in a net $65.6 billion into global money market funds in their biggest weekly net purchase since March 22, data from LSEG showed.

On Tuesday, the Bank of Japan loosened its yield curve control with another policy adjustment, hinting at a cautious retreat from its extensive monetary stimulus.

A day later, the Federal Reserve maintained interest rates steady, with Chair Jerome Powell signalling the potential for further tightening.

U.S., European and Asian money market funds drew inflows worth $56.52 billion, $7.43 billion, and $3.59 billion, respectively.

Global equity funds drew a net $1.79 billion, the first weekly inflow in seven thanks to a surge in demand in Asia and cooling selling pressure in the U.S. and Europe. Investors poured about $2.63 billion into Asian funds, the most in four weeks.

Sectoral equity funds still witnessed outflows of about $4.05 billion, the highest in four, as financials, healthcare and tech lost $1.67 billion, $574 million and $532 million, respectively.

Global bond funds experienced $5.54 billion in outflows, over ten times higher than last week. Government bond funds saw redemptions of about $298 million, halting a 28-week buying streak. High-yield funds faced $1.83 billion in sales, while corporate bond funds drew $1.11 billion.

In commodities, precious metal funds received $1.13 billion worth of inflows compared to $1.04 billion worth of outflows in the previous week. Additionally, energy funds received $44 million, a second weekly inflow.

Data for emerging markets, encompassing 28,658 funds, showed investors withdrew a net $3.06 billion from EM equity funds, extending net selling into a 12th week. EM bond funds also suffered $1.62 billion worth of disposals, a 14th straight week of outflows.

(Reporting by Gaurav Dogra and Patturaja Murugaboopathy in Bengaluru; Editing by Varun H K)

By Caroline Valetkevitch

NEW YORK (Reuters) – Global stock indexes jumped and the U.S. dollar fell on Thursday on investor optimism that the Federal Reserve may be done hiking interest rates, while benchmark 10-year Treasury yields fell to three-week lows.

Investors also took in Thursday’s actions by the Bank of England, which kept rates at a 15-year high and stressed that it did not expect to start cutting them any time soon.

The Fed on Wednesday held interest rates steady as expected, and while Chair Jerome Powell left the door open to more tightening he also nodded to the impact of a recent surge in bond yields on the economy.

Even though neither the Fed nor the BoE signalled that rate cuts were likely any time soon, just the glimpse of light at the end of the tunnel after 20 months of relentless hiking was enough to recharge the bulls.

Bond yields extended their move lower from Wednesday, on relief that the U.S. Treasury Department announced smaller-than-expected increases in longer-dated Treasury supply.

On Wednesday, the Treasury said it would raise auction sizes for longer-dated debt by less than was expected and noted that it expects one more quarter of auction size increases to meet its financing needs.

Benchmark 10-year note yields were last down 12 basis points at 4.669% and earlier reached 4.626%, the lowest since Oct. 13.

In U.S. stocks, the S&P 500 registered its biggest one-day percentage gain since April 27.

Upbeat quarterly corporate results added to bullish sentiment on Wall Street. Apple shares closed up 2.1% ahead of its results after the closing bell.

The Dow Jones Industrial Average rose 564.5 points, or 1.7%, to 33,839.08, the S&P 500 gained 79.92 points, or 1.89%, to 4,317.78 and the Nasdaq Composite added 232.72 points, or 1.78%, to 13,294.19.

The pan-European STOXX 600 index rose 1.58% and MSCI’s gauge of stocks across the globe gained 1.96%, which would be its biggest daily percentage jump since November 2022.

The moves followed sharp gains overnight in Japanese stocks.

In foreign exchange, the U.S. dollar was broadly lower on the perception that U.S. rate had peaked, raising risk appetite.

Brad Bechtel, global head of FX, at Jefferies in New York, said the Fed is probably done hiking rates, but he could see the rationale for tightening one more time given the still-resilient U.S. economy.

“But at the same time, everyone is looking at a slowdown and inflation is going in the right direction,” Bechtel said.

Fed funds futures indicated a sub-20% chance that U.S. rates will rise in December.

Sterling, meanwhile, held firm after the BoE decision. The pound rose as much as 0.6% against the dollar to $1.2225, its highest level in 1-1/2 weeks. Sterling was last up 0.4% at $1.2201.

The dollar index, which measures the greenback against six other major currencies, was last 0.3% lower at 106.18.

Bitcoin, sometimes traded as a proxy for risk-taking, broke above $35,000 to hit its highest level since May 2022.

Oil prices ended sharply higher in the wake of the Fed decision to leave rates unchanged, with U.S. crude futures settling at $82.46 a barrel, up $2.02, and Brent crude futures settling at $86.85, up $2.22.

Also, U.S. non-farm payrolls data is due out on Friday. A tight labor market is considered a key factor in the outlook for interest rates.

(Additional reporting by Gertrude Chavez-Dreyfuss in New York and Marc Jones in London; Editing by Emelia Sithole-Matarise, Susan Fenton, Richard Chang, Nick Macfie and Diane Craft)

By Caroline Valetkevitch

NEW YORK (Reuters) – Global stock indexes jumped and the U.S. dollar fell on Thursday on investor optimism that the Federal Reserve may be done hiking interest rates, while benchmark 10-year Treasury yields fell to three-week lows.

Investors also assessed Thursday’s actions by the Bank of England, which kept rates at a 15-year high and stressed that it did not expect to start cutting them any time soon.

The Fed on Wednesday held interest rates steady as expected, and while Chair Jerome Powell left the door open to more tightening he also nodded to the impact of a recent surge in bond yields on the economy.

Even though neither the Fed nor the BoE signalled that rate cuts were likely any time soon, just the glimpse of light at the end of the tunnel after 20 months of relentless hiking was enough to recharge the bulls.

Bond yields extended their move lower from Wednesday on relief that the U.S. Treasury Department announced smaller-than-expected increases in longer-dated Treasury supply.

Benchmark 10-year notes yields were last down at 4.672% after touching 4.626%, the lowest since Oct. 13.

In stocks, the Dow Jones Industrial Average rose 499.02 points, or 1.5%, to 33,773.6, the S&P 500 gained 73.89 points, or 1.74%, to 4,311.75 and the Nasdaq Composite added 221.13 points, or 1.69%, to 13,282.60.

The pan-European STOXX 600 index rose 1.58% and MSCI’s gauge of stocks across the globe gained 1.88%.

The moves follow sharp gains overnight in Japanese stocks.

In foreign exchange, the U.S. dollar was broadly lower on the perception that U.S. rate had peaked, raising risk appetite.

Brad Bechtel, global head of FX, at Jefferies in New York, said the Fed is probably done hiking rates, but he could see the rationale for tightening one more time given the still-resilient U.S. economy.

“But at the same time, everyone is looking at a slowdown and inflation is going in the right direction,” Bechtel said.

Markets now see a below-20% chance that U.S. rates will rise in December.

Sterling, meanwhile, held firm after the BoE decision. The pound rose as much as 0.6% against the dollar to $1.2225, its highest level in 1-1/2 weeks. It was last up 0.5%.

The dollar index, which measures the greenback against six other major currencies, was last 0.3% lower at 106.12.

Bitcoin, sometimes traded as a proxy for risk-taking, broke above $35,000 to hit its highest level since May 2022.

Oil prices ended sharply higher in the wake of the Fed decision to leave rates unchanged, with U.S. crude futures settling at $82.46 a barrel, up $2.02, and Brent crude futures settling at $86.85, up $2.22.

Investors are keenly awaiting results from Apple, due after the closing bell. Apple, a bellwether for consumer demand and the tech sector, is expected to report a 1% decrease in quarterly revenue.

Also, U.S. non-farm payrolls data is due out on Friday. A tight labor market is considered a key factor in the outlook for interest rates.

(Additional reporting by Gertrude Chavez-Dreyfuss in New York, Marc Jones in London, Stella Qiu in Sydney, and Samuel Indyk in London; Editing by Emelia Sithole-Matarise, Susan Fenton, Richard Chang and Nick Macfie)