U.S. stocks closed higher on Thursday as the Federal Reserve reduced interest rates by 25 basis points, buoying a rally initiated by Donald Trump’s return as U.S. president. The Fed’s quarter-point rate cut reflects their observation of a moderating job market and the continuing approach toward the central bank’s 2% inflation target. Markets had largely anticipated this reduction for November’s meeting, and investors now await further guidance on future monetary policy from the Federal Reserve.
Optimism surrounding Trump’s policies, including potentially reduced corporate taxes and deregulation, boosted key indices, with the Dow and S&P 500 experiencing their most significant one-day percentage gains in two years. The Dow finished slightly down at 43,729.34, the S&P 500 rose 0.74% to 5,973.10, and the Nasdaq advanced 1.51% to 19,269.46. The communications services sector led S&P gains, with a notable 11.81% rise in Warner Bros Discovery following a surprising third-quarter profit.
Despite recent anticipation for further rate cuts, expectations have dimmed amid strong economic data, hinting at continued resilience and potential inflationary pressures under Trump’s administration. Fed Chair Jerome Powell expressed the Fed’s readiness to reassess monetary policy in December, adjusting as necessary amidst prevailing uncertainty. Investors are also monitoring the possibility of Republicans winning control of Congress, which could facilitate Trump’s agenda.
Treasury yields, fluctuating due to recent developments, eased after climbing to a four-month high on Wednesday, settling at 4.332% for the 10-year yield. New data showed a slight increase in U.S. weekly jobless claims, indicating stable labor market conditions. The day’s trading saw advancing issues outnumbering decliners with 56 new 52-week highs and 4 new lows on the S&P 500, while the Nasdaq recorded 193 new highs and 88 new lows. Trading volume reached 16.78 billion shares, surpassing the recent average.
Original Story https://www.investing.com/news/economy-news/futures-steady-after-trumpfueled-rally-feds-rate-decision-awaited-3707743
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Publish Date: 2024-11-08 03:12:00
