The Federal Reserve’s recent decision to cut interest rates has boosted markets to record levels. The question is how long the good performance will last.
Wall Street is in slow progress on Monday as investors focus on a new jobs report due later in the week. The broad market index is up 0.2%, while the Nasdaq Composite is up 0.3%. The Dow Jones Industrial Average is holding near the flat line.
Stocks rebounded slightly on Monday after excitement over last week’s interest rate cut sent the Dow to a record closing high. The S&P 500 and Nasdaq Composite posted gains of 0.2% and 0.3%, respectively, while the Dow hovered around the flat line.
Wall Street: the data the market is looking at
The moves come after a winning week on Wall Street, centered on the Federal Reserve’s decision to cut interest rates by 50 basis points, its first cut in four years. Despite some volatility following the initial announcement, stocks rallied in the days that followed.
The Dow closed Friday at an all-time high, notably above 42,000. All three major indexes added more than 1% for the week, with the S&P 500 also hitting new records.
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“I see the rate cut [de la semana pasada] “as a signal that the Fed is willing to act quickly if it needs an insurance policy against excessive labor market weakening,” Ronald Temple, chief market strategist at Lazard, said in a Friday note.
“The reality is that neither a 25- nor a 50-basis-point cut will materially change the economic trajectory in the near term,” he said. “But the signal is important, and markets responded the next day, driving the S&P 500 index to a new all-time high.”
Source: Ambito
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