Global investors are responding positively to the Federal Reserve’s recent interest rate cut, which is seen as a proactive measure to support economic growth.
On Wall Street, stock futures are on the rise, rebounding after a muted reaction from U.S. markets on Wednesday following the Fed’s announcement of a 0.5-percentage-point cut. Fed Chair Jerome Powell’s comments suggesting that further cuts are not guaranteed dampened market enthusiasm.
Despite this, Jan von Gerich, chief analyst at Nordea, emphasized that the Fed’s commitment to fostering steady economic growth may help mitigate negative reactions to disappointing economic data, particularly concerning the labor market, which has previously unsettled investors.
On Thursday, attention will also turn to the Bank of England, which is expected to hold rates steady after its August cut—the first reduction in four years.
In Recent Trading:
U.S. stock futures surged, with contracts tied to the Nasdaq-100, S&P 500, and Dow Jones Industrial Average rising more than 1%. The major indexes experienced slight declines on Wednesday.
Global stock markets posted gains, with Japan’s Nikkei 225 closing up 2.1%, buoyed by a weaker yen. Hong Kong’s Hang Seng Index and the Stoxx Europe 600 also saw increases.
The WSJ Dollar Index continued its downward trend, while the British pound strengthened against the dollar, reaching its highest intraday level since March 2022.
U.S. Treasury yields increased slightly, with the 10-year yield settling at 3.685% on Wednesday.
Crude oil prices climbed, supported by the weaker dollar, with Brent crude futures surpassing $74 per barrel.
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