US stocks rise on Fed rate cut hopes, bounce in retail sales
Investing.com — U.S. stocks rose Thursday, adding to the previous session’s strong gains after the Federal Reserve signaled interest rate cuts to start next year, helped by a bounce in retail sales.
By 09:35 ET (14:35 GMT), the Dow Jones Industrial Average was up 105 points, or 0.3%, the S&P 500 index traded 24 points, or 0.5%, higher and the NASDAQ Composite climbed 88 points, or 0.6%.
The blue chip DJIA had gained over 500 points, or 1.4%, on Wednesday, registering an all-time closing high. The broad-based S&P 500 and the tech heavy NASDAQ Composite both climbed 1.4%, each to their best closing levels this year.
U.S. Treasury yields dropped sharply as well, with the rate-sensitive 2-year Treasury yield falling to the lowest mark since June and the benchmark 10-year yield dipping to its weakest point since August.
The Federal Reserve kept interest rates steady at a more than two-decade high at Wednesday’s conclusion of its two-day meeting, as widely expected, but its quarterly «dot plot» showed that policymakers were factoring in three quarter-point cuts in 2024, a more dovish outlook than prior estimates.
Additionally, Chair Jerome Powell declined to push back against rate cut expectations, saying a discussion of cuts in borrowing costs is coming «into view.»
Powell also stressed the need to prevent unemployment from spiking, suggesting the strength of the labor market was now rivaling its bid to quell elevated inflation in importance.
That said, economic data released Thursday was relatively optimistic as initial claims for state unemployment benefits dropped 19,000 to a seasonally adjusted 202,000 for the week ended Dec. 9, while U.S. retail sales unexpectedly rose 0.3% on the month in November as the holiday
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