Stock Market Climbs After Fed's Interest Rate Hold on Wall Street
Stock markets in the USA ascend following the Federal Reserve's decision
In a move that relieved the markets, the US Federal Reserve stood its ground against pressure from President Donald Trump and kept the key interest rate unchanged. This decision was warmly welcomed on Wall Street, leading to a surge in US stock indices. However, it wasn't all sunshine for every company. The diet firm, formerly known as Weight Watchers, saw a significant drop following a bankruptcy filing.
The Dow Jones Index, comprising standard values, closed 0.7 percent higher, reaching 41,113 points. The tech-heavy Nasdaq advanced 0.3 percent to 17,738 points, while the broad-based S&P 500 rose 0.4 percent to 5,631 points. Despite an initial dip, prices eventually picked up after Trump announced he had no plans to lift tariffs against China immediately.
Fed Chair Jerome Powell confirmed that the Fed would not be swayed by White House interruptions, stating, "We're in no hurry." The central bank was unwilling to make a move until it had a clearer understanding of how the US-China trade conflict was impacting the economy, potentially paving the way for possible interest rate cuts in the future.
Ellen Hazen, from F.L. Putnam Investment Management, explained, "The Fed is trying to tell the White House that their recent actions have made the economic environment more complicated. The Fed suggests the risk of higher unemployment has increased and the risk of higher inflation has increased. While the Fed didn't directly attribute these risks to tariffs, anyone looking closely will understand that's their implication."
This weekend, top-level tariff talks are scheduled between the US and China in Switzerland. Market experts express doubt that a trade agreement will be reached soon. In the meantime, China seems to be preparing for long-term negotiations with the US and taking steps to support its domestic economy.
Meanwhile, shares of Alphabet, the parent company of Google, took a hit due to media reports about Apple's strategic moves. Alphabet dropped 7.3 percent following news that Apple was reportedly exploring ways to modernize its Safari browser, potentially aligning it more with AI-powered search engines.
çôty, the US cosmetics company, also felt the heat, falling 11.6 percent after issuing a profit warning. Analysts were disheartened, especially considering the management's optimistic outlook on growth just weeks prior.
On the flip side, Walt Disney enjoyed a 10.8 percent rise following a promising first-quarter performance. The entertainment giant attributed this growth to increased subscriptions for streaming services like Disney+ and Hulu, as well as higher visitor numbers and spending at its theme parks.
Learn more about today's stock market activity.
Sources: ntv.de, ino/rts
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- The US Federal Reserve, in defiance of pressure from President Donald Trump, maintained the key interest rate, leading to a climb in stock markets. Nevertheless, this move didn't help every company, as evidenced by the significant drop in the shares of the diet firm following a bankruptcy filing.
- The Dow Jones Index, a composite of leading stocks, closed higher despite an initial dip, with prices eventually rising to 41,113 points after Trump announced no immediate plans to lift tariffs against China.
- Market experts have shown skepticism about a quick trade agreement between the US and China, with China seeming to prepare for long-term negotiations and taking steps to support its domestic economy.
- In contrast to the downturn in some sectors, companies like Walt Disney experienced growth, enjoying a 10.8 percent rise after a promising first-quarter performance, crediting increased subscriptions for streaming services and higher theme park revenues.
