On Thursday, US stocks experienced an increase following the Federal Reserve’s decision to resume lowering interest rates and indicate that additional cuts are forthcoming. The Nasdaq Composite (^IXIC) was at the forefront of these gains, buoyed by Nvidia’s (NVDA) support for Intel (INTC), which lifted market sentiment.
The Nasdaq surged by nearly 0.9%, while the S&P 500 (^GSPC) rose by 0.4%, reaching new levels and maintaining the potential for a fresh record close. The Dow Jones Industrial Average (^DJI), which comprises a smaller number of technology stocks, saw a modest increase of 0.1%.
Intel’s shares experienced a rise exceeding 25% during early trading as investors reacted positively to Nvidia’s $5 billion investment in the ailing US chip manufacturer.
In a broader context, markets are overcoming the initial uncertainty that had weighed on stocks following the Federal Reserve’s decision to lower rates by a quarter percentage point on Wednesday. Although the Fed’s ‘dot plot’ indicated the possibility of two additional cuts in 2025, Chair Jerome Powell’s statement regarding high inflation and a fragile labor market, which leaves ‘no risk-free path,’ has undermined confidence.
The weekly jobless claims data released on Thursday indicated additional signs of strain within the labor market. On a positive note, the number of Americans submitting unemployment claims decreased following a significant increase the prior week. However, hiring has nearly come to a standstill as both demand and supply for workers have diminished.
In corporate news, FedEx (FDX) is set to announce its quarterly earnings after the market closes. Analysts anticipate that the delivery company’s profits will be adversely affected by President Trump’s decision to eliminate the “de minimus” tariff exemption for low-value direct-to-consumer shipments from China and Hong Kong.
