Wall Street’s main indexes saw gains on Thursday, headed by the tech giant Apple reaching a new high. The previous day, the Federal Reserve had suggested that it would be ending its aggressive rate-hike campaign and that interest rates will drop in the upcoming year.
As anticipated, the Federal Reserve kept interest rates constant on Wednesday. Chair Jerome Powell stated that, given the unexpectedly low rate of inflation and the developing “into view” talks about reducing borrowing costs, the unprecedented tightening of monetary policy was probably coming to an end.
In an attempt to reduce decades-high inflation, the Fed has increased its policy rate by a market-punishing 525 basis points since March 2022. 17 out of 19 Fed members predicted on Wednesday that by the end of 2024, the policy rate will have decreased.
Stocks rose as a result of the central bank’s dovish turn in its announcement, and on Thursday the Dow Jones Industrial Average Index set new intraday records.
Chief investment officer of Independent Advisor Alliance Chris Zaccarelli stated, “Investors are feeling pretty bullish about having three rate cuts pencilled in for next year, which is a little bit more than the bears were expecting.”
With nearly fully pricing in another cut in May, money markets now project an 83.3% likelihood of at least a 25 basis point rate decrease in March 2024, up from about 50% before to the policy decision, according to CME Group’s FedWatch tool.
The yield on the benchmark 10-year Treasury note decreased to 3.9488% as the currency fell to levels not seen in more than four months.
which, according to experts surveyed by Reuters, increased 0.3% on a monthly basis against forecasts of a 0.1% decline.
According to a different survey, weekly unemployment claims decreased from a projected 220,000 to 202,000 for the week ending December 9.
In the meantime, Apple’s stock increased by 0.7%, hitting a record intraday high of $199.62 and breaking beyond its top from July.
The S&P 500 was up 21.56 points, or 0.46%, at 4,728.65, the Nasdaq Composite was up 92.21 points, or 0.63%, at 14,826.17, and the Dow Jones Industrial Average was up 35.43 points, or 0.10%, at 37,125.67 at 9:42 a.m. ET.
Real estate stocks led ten of the S&P 500’s top 11 sectors higher, rising 2.3%, while the small-cap Russell 2000 index jumped 2.9% to reach its highest level since early February.
After the creator of Photoshop predicted yearly and quarterly income below forecasts, Adobe lost 7.2% of its value.
When combined with Merck’s Keytruda medication, an experimental messenger RNA cancer vaccine that Moderna co-developed reduced the risk of melanoma mortality or recurrence by half after three years, causing the company’s stock to soar 15.9%.
Following Warren Buffett’s Berkshire Hathaway’s purchase of over 10.5 million shares of the oil giant for around $588.7 million, Occidental Petroleum saw a 3.4% increase in value.
After being upgraded from “neutral” to “overweight” by Piper Sandler, Foot Locker had a 6.9% increase in value.
On the NYSE, advances exceeded decliners by a ratio of 7.87 to 1, while on the Nasdaq, the ratio was 4.45 to 1.
While the Nasdaq registered 198 new highs and 17 new lows, the S&P index posted 81 new 52-week highs and no new lows.