Rate-cut Expectations Keep Wall Street Indexes Near Record Highs

Barry Adams
16 May, 2024
New York City

Stocks on Wall Street inched forward after major indexes soared to new record highs in the previous session. 

The S&P 500 index and the Nasdaq Composite advanced to new highs after annual core consumer price inflation rose 3.4%, less than expected in April. 

The lighter-than-expected inflation report followed the hotter-than-expected producer price inflation update released on Tuesday. 

Investors bid up tech and high-growth stocks in the hopes that the Federal Reserve has more flexibility in lowering interest rates in the second half. 

 

Building Permits Declined in April

Building permits declined by 3% to a seasonally adjusted annual rate of 1.44 million in April, the U.S. Census Bureau reported Thursday. 

The annual pace of building permits dropped to the lowest level since 1.4 million in December 2022. 

High interest rates and high land and construction costs continued to dent the market. 

Single-family authorization declined by 0.8% to 976,000, and multi-family authorization dropped 9.1% to 408,000. 

Permits in the Midwest fell by 18.1% to 167,000, in the West by 14.4% to 292,000, but rose in the South by 4.2% to 827,000 and increased by 5.5% in the Northeast to 154,000. 

 

U.S. Indexes and Treasury Yields

The S&P 500 index increased 0.1% to 5,310.06, and the Nasdaq Composite rose 0.5% to 16,752.71. 

The yield on 2-year Treasury notes edged lower to 4.76%, 10-year Treasury notes decreased to 4.34%, and 30-year Treasury bonds edged lower to 4.49%.

WTI crude oil increased $0.13 to $78.76 a barrel, and natural gas prices increased 2 cents to $2.43 a thermal unit.

Gold decreased by $7.73 to $2,384.29 an ounce, and silver fell 10 cents to $29.62. 

The dollar index, which weighs the U.S. dollar against a basket of foreign currencies, edged lower to 104.47.

 

U.S. Stock Movers

Cisco Systems jumped 3.2% to $51.24 after the networking gear maker reported better-than-estimated fiscal third quarter earnings. 

Walmart Inc. increased 5.6% to $63.05 after the retail giant reported better-than-expected fiscal first-quarter results. 

Chubb Ltd. increased 6.7% to $269.99 after Berkshire Hathaway disclosed in a regulatory filing that it has acquired nearly 26 million shares for $6.7 billion. 

Meta Platforms declined 0.9% to $477.45 after the social media platform operator was under investigation by the European Commission for the alleged breaking of the region's content laws regarding child safety. 

Deere & Co. decreased 5.8% to $390.0 after the farm equipment maker lowered its annual earnings outlook. 

The agriculture equipment maker reported better-than-expected quarterly results and lowered its annual earnings outlook to $7 billion from the previous estimate between $7.50 and $7.75 billion.