“U.S. stocks fell, with all three major indexes posting their biggest daily declines in months after the Federal Reserve cut interest rates by a quarter of a percentage point, but disappointed some investors with forecasts that signaled a more cautious easing path next year.”, — write: epravda.com.ua
U.S. stocks fell, with all three major indexes posting their biggest daily declines in months after the Federal Reserve cut interest rates by a quarter of a percentage point, but disappointed some investors with forecasts that signaled a more cautious easing path next year. Reuters writes about it. The Fed cut rates by 25 basis points to a range of 4.25%-4.50%, and indicated in its Brief Review of Economic Projections (SEP) that it would cut rates by another half percentage point by the end of 2025, given the robust labor market and the recent halt in the decline in inflation. The Dow Jones Industrial Average fell 1,123.03 points, or 2.58%, to 42,326.87, the S&P 500 lost 178.45 points, or 2.95%, to 5,872.16 and the Nasdaq Composite lost 716.37 points, or 3.56%, by the 19th 392.69.Advertisement: The Dow suffered its 10th straight session of decline, its longest daily losing streak since an 11-session slide in October 1974. The Dow and S&P posted their biggest one-day percentage declines since Aug. 5, while the Nasdaq posted its biggest one-day drop since July 24. The Russell 2000 fell 4.4%, its biggest drop since June 16, 2022. Small-cap stocks are more likely to benefit from lower interest rates.Advertisement: Despite the decline, the Dow is up nearly 12.3% for the year, the S&P is up 23% and the Nasdaq is up more than 29%, driven largely by technology companies and enthusiasm around artificial intelligence, as well as the prospect of lower interest rates and, more recently, hopes for deregulation policies from the new administration of the president-elect Donald Trump. We will remind: the US Federal Reserve System (FED) lowered the base rate by 50 basis points to the target range of 4.75%-5.0% for the first time since 2020.