With the strengthening of expectations that the US Federal Reserve (Fed) will start interest rate cuts later, a recovery was seen in the equity markets, which were dominated by a negative course.
The New York stock exchange ended the day with an increase.
At the close, the Dow Jones index gained over 150 points and rose 0.40 percent to 38,424.27 points.
The S&P 500 index rose 0.96 percent to 5,000.62 points and the Nasdaq index gained 1.30 percent to 15,859.15 points.
Following the inflation data that exceeded forecasts in the US on Tuesday, a recovery was seen in the equity markets, where the negative course was dominated by the strengthening of expectations that the US Federal Reserve (Fed) would start interest rate cuts later.
The US 10-year bond yield, which tested its highest level since December 1, rising to 4.32 percent after inflation exceeded forecasts in the country, fell to 4.26 percent.
GOOLSBEE: INFLATION IS PROGRESSING IN LINE WITH THE TARGET
While Fed officials’ verbal guidance was monitored, Chicago Fed President Austan Goolsbee stated that inflation, although slightly higher in the next few months, is still in line with the path to return to target. Noting that the current monetary policy stance is quite restrictive, Goolsbee said that if it remains restrictive for too long, the Fed will have to worry about the employment target. Goolsbee stated that rate cuts should depend on confidence that the Fed is on the path to the target interest rate.
Michael Barr, the Fed’s Vice Chairman for Supervision, said the
stronger-than-expected inflation data was a reminder that the Fed’s path back to its inflation target could be “bumpy”. Barr emphasized that they are confident that they are on their way to the 2 percent inflation target, but that they need to see good data continue to come before they start cutting interest rates.
On the other hand, the Producer Price Index (PPI) data for December last year in the US was revised. Accordingly, the change in PPI, which was previously announced as a 0.1 percent decrease for December 2023 in the country, was revised as a 0.2 percent decrease.
LYFT’S SPELLING ERROR DEPRECIATED 25%
While the ongoing balance sheet season in the US remains in the focus of the markets, the rise in Lyft’s shares, which reached 60 percent after its financial results exceeded expectations, fell to 35 percent after the company’s chief financial officer stated that there was a typo in the profit margin outlook in the balance sheet statement.
Uber’s shares also rose over 14 percent to an all-time high of $ 79.15.
Shares of California-based chip maker Nvidia rose over 2 percent, while the company surpassed Alphabet after Amazon with a market value of $ 1.83 trillion.
Airbnb’s shares fell nearly 2 percent, despite the company’s revenue exceeding expectations in the last quarter of last year.
