US stocks rebound after Fed rate disappointment
Wall Street rebounded on Thursday as shares in US tech titans rose after a selloff that was sparked by the US Federal Reserve dousing hopes of an imminent interest-rate cut. Shares in Amazon, Apple and Facebook owner Meta were all up at the open, with all three due to publish earnings reports after markets close. Microsoft and Google parent Alphabet also started higher following disappointing results the previous day. Adam Sarhan of 50 Park Investments said the market is recovering from the "knee-jerk" selloff after Wednesday's Fed meeting. "The market knows that it's a matter of when, not if, the Fed's going to cut rates," he said. Wall Street's main indices – the Dow, the tech-heavy Nasdaq and the S&P 500 – had tumbled on Wednesday after the Fed's disappointing rate signal. The central bank kept its rate unchanged at a 23-year high, as expected, but chairman Jerome Powell then warned that a cut was unlikely in March. "Wall Street's still licking its wounds following post-meeting remarks from Fed Chairman Jerome Powell that effectively pulled the rug out from hopes for a March rate cut," analysts at investment firm Charles Schwab said in a note. Powell said that "almost everyone" at the Fed favoured a step down this year but, he added, "I don't think it's likely that the committee will reach a level of confidence by the time of the March meeting to identify March as the time to cut." The Fed, the European Central Bank and the Bank of England raised their interest rates multiple times to combat inflation, but all have kept them on hold now that consumer prices have started to cool. The BoE froze its key interest rate on Thursday for a fourth meeting in a row. Its governor Andrew Bailey warned there was a "need to see more evidence that inflation is set to fall" to the bank's two-percent target, "and stay there, before we can lower interest rates." London's benchmark FTSE 100 index was up in afternoon deals. Shares in British energy major Shell jumped three percent as dealers shrugged off slumping annual net profit to focus on better-than-expected adjusted earnings and share buybacks. The eurozone's main markets, Paris and Frankfurt, were down even as data showed inflation slowed in January to 2.8 percent. Shares in French banking giant BNP Paribas and Dutch lender ING tumbled around seven percent each as disappointing fourth-quarter results took the shine off bumper annual profits. Deutsche Bank rallied five percent after it revealed plans to slash 3,500 jobs following a decline to annual profits. (AFP)