Reuters, NEW YORK, August 25 – As investors processed remarks from Federal Reserve Chair Jerome Powell that the U.S. central bank may need to hike interest rates further to ensure inflation is managed, U.S. stocks slightly increased during Friday’s tumultuous afternoon trade.
Since his eagerly awaited lecture at the Economic Policy Symposium in Jackson Hole, Wyoming, trading has been jittery. Powell also acknowledged a reduction in price pressure.
He is expressing his satisfaction with the advancements made in monetary policy and the decline in inflation. But he is still firmly believing that they are keeping a close eye on it and that there is still work to be done, according to Michael Arone, chief investment strategist at State Street Global Advisors in Boston. Since March 2022, the Fed has been increasing interest rates in an effort to reduce inflation. Following Powell’s remarks, the FedWatch tool from CME Group showed an increase over the previous day in expectations of a rate hike in November. Most traders continue to predict that the Fed won’t raise interest rates in September.
The majority of S&P 500 sectors had gains, headed by energy, which rose 1.5% along with an increase in oil prices, and technology, which increased by 0.7%.
The Nasdaq Composite increased 121.76 points, or 0.9%, to 13,585.73, the S&P 500 increased 33.85 points, or 0.77%, to 4,410.16, and the Dow Jones Industrial Average increased 302.35 points, or 0.89%, to 34,401.77.
The market gained in anticipation of Nvidia’s second-quarter results, which the company disclosed on Wednesday after the bell. As a result, the S&P 500 and Nasdaq were expected to conclude the week higher.
Retailers’ reactions to recent outcomes were divided. Gap increased by 7.2% after exceeding second-quarter profit projections, while Nordstrom declined by 7.1% as a result of maintaining its forecasts.
Marvell Technology’s stock dropped 5.6% after the chip manufacturer reported a decline in second-quarter revenue.
After the government of Maui sued the power company, Hawaiian Electric, which has been under fire for posing as a cause of the Hawaii wildfires, saw a 19% decline in stock.
On the New York Stock Exchange, advancers outnumbered decliners 1.77 to 1; on the Nasdaq, advancers were favoured 1.34 to 1.