Wall Street Enthusiasm Pushes Major Indexes Near Record Territory

Barry Adams
23 Sep, 2024
New York City

Benchmark indexes looked higher following the sharp gains the previous week after the Federal Reserve announced a bod rate cut. 

Financial markets cheered the jumbo-sized 50 basis points rate cut after some initial hesitation, as investors hoped that the central bank was more likely to engineer a so-called "soft landing," a gradual economic slowdown without dipping the economy into a recession. 

The rate cut was also seen as the Fed’s acknowledgement that labor market conditions are moderate and inflation is falling at a faster-than-expected pace.

However, the large rate cut may fan inflationary forces in the months ahead, prolonging higher inflation next year.

But for now, investors around the world cheered the Fed’s aggressive move and awaited additional rate cuts later in the year. 

On Monday, the release of the manufacturing and service sector activities survey is set to kick-off a busy week of economic releases. 

Investors are hoping to get more insights into the growth drivers in the service sector, the main driver of the U.S. economy. 

Investors are looking forward to the release of the PCE price index, an alternative measure of inflation, amid expectation of an increase of 0.2% from the previous month in August.

Second quarter GDP growth revision, durable goods orders, and new and pending home sales data are also set to be released this week. 

 

U.S. Indexes and Treasury Yields

The S&P 500 index increased 0.2% to 5,715.87, the Nasdaq Composite rose 0.1% to 17,968.59, and the Russell 2000 index fell 1.1% to 2,227.89. 

The yield on 2-year Treasury notes edged lower to 3.58%, 10-year Treasury notes inched up to 3.75%, and 30-year Treasury bonds inched higher to 4.10%.

WTI crude oil increased $0.11 to $71.11 a barrel, and natural gas prices edged up 6 cents to $2.50 a thermal unit.

Gold rose by $3.48 to $2,625.13 an ounce, and silver decreased by $0.41 to $30.75.

The dollar index, which weighs the US currency against a basket of foreign currencies, edged higher to 100.94.

 

U.S. Stock Movers

Ciena Corp. jumped 4.2% to $61.31 after the networking software and system developer for optical connectivity was upgraded to "buy" from "sell," citing improving conditions in the telecom industry. 

Intel Corp. increased 2.4% to $22.43 on a report that Apollo Global Management offered the chipmaker to make an equity-like investment of as much as $5 billion. 

The news was first reported by Bloomberg News on Sunday. 

Intel has fallen more than 60% from a high of $68.26 reached in early April 2021, as the advanced chipmaker struggled to make a transition to smaller and more powerful chips suitable for artificial intelligence applications amid rising competitions.