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New York (AFP) – The New York Stock Exchange ended in the green on Wednesday following a modest increase in interest rates from the Fed, as expected, and the balanced tone of its chairman Jerome Powell.
Nervous ahead of the monetary decision, the tech-heavy Nasdaq climbed 2.00% and the S&P 500 1.05% while the Dow Jones returned to stability (+0.02%), according to reports. final results.
The Fed raised its overnight rates by 25 basis points, which represents a slowdown in the pace of previous monetary tightenings.
The central bank boss indicated that at least two more rate hikes were possible this year, which might involve a pause in the spring, and dismissed the idea, if the economy behaves as expected, that a reduction rates come in this year. But at the same time, he insisted that those decisions remained data-driven.
“There was something for everyone, hawks (or supporters of a tough fight once morest inflation) like doves (more flexible on monetary policy)”, commented Tom Cahill of Ventura Wealth Management. “His tone was very balanced,” he added.
The same story at B. Riley Wealth Management om Art Hogan recalled that Jerome Powell “can be dry and pithy (…) as he was in Jackson Hole” where he had warned that the rise in rates was going to “do suffer”. But according to Art Hogan, “this press conference was as hawkish as a dove”.
On the bond market, ten-point rates eased significantly to 3.41% instead of 3.50%.
Spartan Capital’s Peter Cardillo noted that the stock market’s transportation sector surged in response to the Fed Chairman’s press conference. “The transport sector is a good indication of how the economy will behave six months later,” said the analyst, while airlines concluded a sharp increase such as Delta Airlines (+ 2.02%) or American Airlines (+3.41%).
Meta, Facebook’s parent company, climbed more than 18% in electronic trading following the close. The social media giant’s revenue fell in 2022 but remained above forecasts for the fourth quarter as a $40 billion share buyback program was announced.
© 2023 AFP
