S&P 500, Nasdaq rally to records on rate cut hopes
Wall Street stocks powered higher on Wednesday with major indices finishing up more than one percent, hitting fresh records amid rising expectations for upcoming interest rate cuts. Both the S&P 500 and Nasdaq ended at all-time highs following comments from US Federal Reserve Chair Jerome Powell that the central bank would not wait until inflation hit two percent before considering a rate cut. Treasury bond yields retreated, with analysts citing strong demand at a 10-year Treasury note auction. The Dow Jones gained 1.1 percent to 38,921. The S&P 500 climbed 1.0 percent to 5,633 for its sixth straight record, while the Nasdaq jumped 1.2 percent to 18,647 to end at its seventh straight record. Powell's remarks came in congressional testimony before a House panel. "We've said that you don't want to wait until inflation gets all the way down to two percent, because inflation has a certain momentum," Powell said. "If you waited that long, you've probably waited too long." Spartan Capital's Peter Cardillo said the rally was notable one day before the market sees key new US consumer price data. "Powell is basically telegraphing to the market that we are having a rate cut in September," Cardillo said. "That's what's behind the move here." Among individual companies, Microsoft advanced 1.5 percent as the tech giant informed regulators that it will not take a non-voting position on the board of OpenAI amid scrutiny of its influence over the groundbreaking ChatGPT maker. Honeywell International gained 1.9 percent after announcing that it purchased Air Products' liquefied natural gas process technology and equipment business for US$1.8 billion. Air Products advanced 0.4 percent. Advanced Micro Devices won 3.9 percent as it announced plans to acquire Silo AI, the largest private artificial intelligence lab in Europe, for about US$665 million. (AFP)