Wall Street extends overnight record setting after SNB cut, steady Fed
investing.comBy Alden Bentley, Alun John and Tom Westbrook
NEW YORK/LONDON/SINGAPORE (Reuters) -Global share benchmarks rallied farther into uncharted territory on Thursday and yields on government debt mainly fell after the Swiss National Bank became the first major central bank to ease policy in this cycle, a day after the Federal Reserve maintained its outlook for 2024 rate cuts.
The dollar rose as the Swiss franc eased and the yen stayed on the back foot, near its lowest level in about four months.
Wall Street closed with all three major indexes extending their streak of record highs, on the heels of similar milestones earlier in Japan and Europe and in gold.
A risk-on mood was fanned on Wednesday when the Federal Reserve ended its regular meeting with no change in U.S. rates, or its «dot plot» projections to cut rates by 75 basis points this year.
Its announcement was interpreted dovishly by investors who had lately been wondering if the Fed would scale back its projections for cuts this year due to stubbornly high inflation.
«Usually when you see the dollar rally, you'll see stocks fall off, but probably with that Swiss National Bank news it kind of changed things around,» said Joe Saluzzi, co-manager of Themis Trading in Chatham, New Jersey.
When Fed chair Jerome Powell on Wednesday «talked about the balance sheet and how they want the balance sheet to run off a little bit slower — I don't want to call it 'QE light,' but by them not shrinking it as fast, I think it's a bullish thing for the market,» Saluzzi said.
The Bank of England on Thursday wrapped up a busy week for global central banks by leaving rates unchanged but saying the British economy is «moving in the right direction» for it to start cutting interest rates.
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