Market Rally: Tech Stocks Soar, Fed Chair Comments Boost Confidence
A strong tech rally propelled US stocks to new record highs on Wednesday, with all three major indexes closing at unprecedented levels. The Dow Jones Industrial Average surged 0.7%, or over 300 points, to break the 45,000 barrier for the first time ever. Meanwhile, the S&P 500 added roughly 0.6% to reach a fresh closing high of 6,086.49, and the tech-heavy Nasdaq Composite climbed 1.3% to set a new record at 19,735.12.
Fed Chair’s Comments Boost Market Confidence
Federal Reserve Chair Jerome Powell’s remarks at the New York Times DealBook Summit contributed to the market’s optimism. Powell emphasized that the US economy is in “remarkably good shape,” which suggests that the Fed can afford to be cautious in its interest rate-cutting path. This sentiment has led traders to anticipate a 25 basis point rate cut at the December 18 meeting, with odds increasing to nearly 77%.
Tech Giants Lead the Charge
Cloud and e-commerce giant Salesforce (CRM) saw its stock surge 11% after its quarterly revenue beat boosted hopes for its artificial intelligence products. Other tech heavyweights, such as Nvidia (NVDA) and Apple (AAPL), also reached intraday all-time highs.
Labor Market Shows Signs of Softening
A reading on private payrolls indicated that the labor market is softening, although not dramatically. This data comes ahead of the crucial monthly jobs report on Friday. Meanwhile, a report from ADP revealed that the median year-over-year pay increase for job switchers rose to 7.2% in November, suggesting that the labor market still has some tightness.
Cryptocurrency Market Reacts to Regulatory News
Bitcoin (BTC-USD) approached a milestone of its own, nearly touching $100,000 per coin, following President-elect Donald Trump’s nomination of Paul Atkins as the next chair of the Securities and Exchange Commission. Atkins is seen as a pro-cryptocurrency official, which has boosted investor confidence in the digital asset market.
Corporate News Roundup
UnitedHealth Group (UNH) halted its investor day after the CEO of insurance unit UnitedHealthcare, Brian Thompson, was fatally shot in Manhattan. Foot Locker (FL) shares plummeted 12% after the footwear retailer cut its full-year guidance and missed third-quarter estimates, citing weak consumer demand. Amazon (AMZN) hit an all-time high amid its AWS re:Invent 2024 cloud conference, with numerous Wall Street analysts reaffirming their bullish Buy ratings on the stock.
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