In Wall Street The S&P 500 rises 0.2% and is on track for its biggest weekly gain since early November 2023. The Dow Jones Industrial Average rises 0.4%, and the Nasdaq Composite Index gives up 0.8%.
The relatively calm trading follows big gains and new records for the indices earlier in the week, following the victory of donald trump in the presidential elections and a new rate cut by the Federal Reserve to stimulate the economy.
Market stability
Contributing to the market’s stability was Airbnb, which fell 8.8% after the online vacation rental platform posted a mixed third-quarter earnings report and issued fourth-quarter forecasts that disappointed investors.
Pinterest, the digital pinboard and shopping platform, fell 13.9% after its revenue guidance came in below investors’ expectations, although it far exceeded Wall Street’s sales and profit targets.
In the bond market, Treasury yields also remained more stable after wide swings earlier in the week.
The yield on the 10-year Treasury note fell to 4.30% from 4.33% on Thursday afternoon, although it remains well above its level in mid-September, when it was around 3.60%.
Treasury yields have risen in part because the U.S. economy has proven to be much more resilient than expected. The hope is that it will remain strong as long as the Federal Reserve continues to lower interest rates to maintain an active labor market, as it has managed to bring inflation closer to its 2% target.
Part of the rise in yields is also due to Trump. His statements on tariffs and other policies, which economists point to as factors that could drive up inflation and U.S. government debt, as well as economic growth, have weighed on the market.
Traders began reducing forecasts for how many rate cuts the Fed will make next year because of this. While lower rates can boost the economy, they can also stoke inflation.
Source: Ambito
