NEW YORK, Sept 14 – US stocks closed higher on Friday as the likelihood of a more aggressive interest rate cut by the Federal Reserve grew significantly, boosting market optimism, reported Xinhua.
This surge in expectations fueled positive sentiment on Wall Street, contributing to the stock market’s gains.
The Dow Jones Industrial Average rose 297.01 points, or 0.72 per cent, to 41,393.78. The S&P 500 added 30.26 points, or 0.54 per cent, to 5,626.02. The Nasdaq Composite Index increased 114.30 points, or 0.65 per cent, to 17,683.98.
All of the 11 primary S&P 500 sectors ended in green, with utilities and communication services leading the gainers by adding 1.41 per cent and 1.02 per cent, respectively. Health posted the weakest growth, up by 0.19 per cent.
The likelihood of the Fed initiating its rate-cutting cycle next week with a 0.5-percentage-point reduction has surged.
Recent trading in interest-rate futures has suggested a 49 per cent chance of the Fed lowering rates to a range of 4.75 per cent to 5 per cent, according to the CME FedWatch tool. This is a significant increase from a 28 per cent chance on Thursday and just 14 per cent on Wednesday, reflecting a shift in market expectations.
In the stock market, Adobe shares fell in afternoon trading after the company’s outlook showed little immediate benefit from its AI initiatives.
On the other hand, Oracle stock continued its rise, supported by a bullish forecast predicting a surge in revenue over the next five years, driven by strong cloud demand.
Meanwhile, Boeing shares slipped as factory workers went on strike, halting production at the company’s largest manufacturing hub in Seattle.
