Wall Street is mixed after Fed official dispels possibility of rate cut

In this context, despite the fact that the main indices began the day on the rise, now the Industrial Average Dow Jones remains stable at 38,863.14 units; the index S&P 500 improves just 3.66 points, or 0.1%, to 5,184.40 units; and the Nasdaq Composite It lost 26.41 points, or 0.2%, to 16,322.83 units.

Walt Disney loses almost 10% as an unexpected profit in its streaming entertainment division was overshadowed by a decline in its traditional television business and a weaker box office.

Wall Street turns upside down due to statements by a Fed governor

The three main indices started trading at highs in more than three weeks, after a report on the labor market weaker than expected last week fueled bets that the Fed will ease monetary policy this year. However, after the statements of Neel Kashkari.

“I would need to see multiple positive inflation readings that suggest the disinflation process is underway” to support a rate cut, Kashkari told a conference of the Milken Institute.

He noted that he will also continue the evolution of the labor marketwhere a “marked” turn toward weakness could also justify a rate cut.

“There’s a limit to when we say, ‘Okay, we’ve got to do more.’ I think it’s much more likely that we’re going to sit here longer than we expect, or the public expects at this point, until we see what effect they have.” our monetary policies,” he added.

In March I thought the Fed would have to make two rate cuts this year, and next month it may lower that forecast to just one cut or even none, depending on the data.said the governor of the Fed of Minneapolis.

Labor market data calms jitters over upcoming rate cuts

He labor report and better-than-expected earnings reports helped calm investor jitters, which weighed on markets in April on concerns that sticky inflation and a Robust economy will lead the Fed to keep rates high for longer.

“The market continues to believe that inflation will be tamed, maybe not up to 2%, but below 3%. “Central banks will win and the cost will be a slower economy,” he said. Hal Reynoldsfrom Los Angeles Capital Management.

“That will happen at the end of the year or the beginning of next year and there will be rate cuts. But there is still quite a bit of noise. I don’t think things are much clearer today than they were two months ago,” he added.

The earnings season was favorable for the markets. Of the almost four fifths of the companies in the S&P 500 that had presented results for the first quarter until Friday, 76.8% beat analyst profit estimates, according to LSEG data. In a typical quarter, 67% exceed these forecasts.