Stocks jump to new highs as Fed buzz lifts markets
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Stocks on Wall Street rose to build on a record-setting rally on Thursday as relieved investors continued to celebrate the Federal Reserve’s signals it will delay but not slow rate cuts.
The S&P 500 (^GSPC) rose 0.5%, surpassing 5,250. The Dow Jones Industrial Average (^DJI) gained 0.5% to creep closer to the 40,000 mark, while the tech-heavy Nasdaq Composite (^IXIC) moved up 0.9%.
The stock indexes closed Wednesday at all-time highs after the Fed put to rest investors’ worries that coming cuts to borrowing costs would be less deep than forecast. Policymakers stuck to their outlook for three rate cuts in 2024, despite sticky inflation data that might have led to a scaling-back in easing.
A sea of green for stocks worldwide followed the “dot plot” forecasts and Chair Jerome Powell’s lack of alarm over the Fed reaching its inflation goal. Gold (GC=F) jumped to a record above $2,200 an ounce.
With six weeks until the next Fed policy meeting in May, other drivers for stocks are now likely to come into focus. While AI growth hopes have provided a boost to techs, there were signs of broadening in the market’s relief rally.
Read more: What the Fed rate decision means for your money
Elsewhere, the Swiss National Bank stole a march on the Fed by lowering interest rates on Thursday. The surprise move made it the first central bank to pull back and was seen as boosting confidence that tightening has peaked in leading economies.
On the corporate front, Reddit (RDDT) is poised for its debut on the NYSE on Thursday. The social media platform priced its IPO at the top end of its $31 to $34 range for a valuation of $6.4 billion.
Among big movers, Micron (MU) shares jumped more than 18% after the memory chip maker’s strong current-quarter revenue forecast amid demand for its AI hardware.
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