U. S. stock market ends week with growth amid easing of Fed’s policy
2023.03.03 13:45
U. S. stock market ends week with growth amid easing of Fed’s policy
By Tiffany Smith
Budrigannews.com – As Treasury yields took a break from a week-long rally that was sparked by concerns that the Federal Reserve would keep interest rates higher for a longer period of time in order to tame stubborn inflation, U.S. stock indexes rose on Friday, setting the stage for gains for the week.
This month, economic data pointed to rising raw material costs and a robust labor market, indicating that the U.S. central bank had not yet seen the desired impact of its monetary policy tightening on inflation. As a result, trading has been choppy.
After reaching a four-month high in the previous session, the decreased on Friday, but it remained close to the 4% level.
According to the survey conducted by the Institute for Supply Management, the U.S. services sector experienced steady growth in February, with new orders and employment reaching all-time highs, indicating that the economy continued to expand in the first quarter.
John Augustine, Huntington National Bank’s chief investment officer, stated, “The ISM (survey) arguably came in close to expectations, but it still signals growth.”
“To see long-term yields fall today is surprising, but the expectation that the Fed will tighten hasn’t changed and recession fears appear to be subsiding.”
After Atlanta Fed President Raphael Bostic stated that the impact of higher rates on the economy might only begin to “bite” in earnest this spring, arguing for the Fed to maintain “steady” quarter-point rate increases, U.S. stocks closed higher on Thursday.
Weekly gains were predicted for the three main indexes, with the Dow experiencing its first weekly rise in five years.
Traders have priced in at least three additional 25 basis point rate hikes this year, anticipating interest rates reaching a peak of 5.46 percent by September from the current 4.66 percent, based on hawkish comments from Fed policymakers and recent economic data.
Investors are awaiting monthly payrolls and consumer prices data to determine whether the Fed will go big later this month. The odds of a 50 basis point rate hike in March were just 20%.
In its most recent semiannual report on monetary policy and the economy, the Federal Reserve stated that it is “strongly committed” to its 2% target and is “acutely aware” of the difficulties that high inflation poses to the economy.
The was up 221.75 points, or 0.67 percent, at 33,225.32 at 11:56 a.m. ET, 41.12 points, or 1.03%, at 4,022.47, and 148.13 points, or 1.29 percent, at 11,611.12.
For a second session, the S&P 500 traded above its 200-day moving average, which traders consider to be an important support level.
(NASDAQ) Apple Inc. after Morgan Stanley (NYSE:) climbed 2.7% said the stock could revitalize over 20% this year on potential equipment membership.
Costco Wholesale Corporation (NASDAQ:) slipped 3.1% as consumers cut back on spending amid high inflation as the membership-only retail chain missed revenue estimates for the second quarter.
(NASDAQ) Broadcom The chipmaker’s second-quarter revenue forecast, which exceeded analysts’ expectations due to increased investments in AI, led to a 4.8% increase in Inc.
On the NYSE, the ratio of advancing issues to decliners was 3.83 to 1, while the ratio on the Nasdaq was 1.92 to 1.
There were 17 new 52-week highs and two new lows on the S&P 500 index, while there were 59 new highs and 43 new lows on the Nasdaq.
