Major US indexes notch fresh records on rate cut hopes

Sign up now: Get ST's newsletters delivered to your inbox

Traders working on the floor of the New York Stock Exchange, in New York City, on Sept 11.

Traders working on the floor of the New York Stock Exchange, in New York City, on Sept 11.

PHOTO: REUTERS

Google Preferred Source badge
  • US stock indexes reached record highs as inflation data met expectations.
  • Increased jobless claims fuel anticipation of a Federal Reserve interest rate cut.
  • Warner Bros Discovery shares jumped following a Paramount Skydance bid report.

AI generated

NEW YORK - Wall Street’s major indexes hit fresh records Sept 11 as US inflation and jobless claims data added to conviction that the Federal Reserve would lower interest rates next week.

The Dow Jones Industrial average climbed 1.4 per cent to 46,108.00, while the S&P 500 Index rose 0.9 per cent to 6,587.47.

The tech-focused Nasdaq Composite Index added 0.7 per cent to 22,043.07.

While the consumer price index (CPI), a key gauge of inflation, hit its highest level since the start of the year in August, this was in line with analysts’ expectations.

The 2.9 per cent year-on-year CPI increase, coupled with a jump in initial jobless claims to its highest reading since 2021, reinforced hopes that the Fed would cut rates to boost the economy as it pivots towards addressing cooling employment.

Since its last reduction in December, the central bank has held the benchmark lending rate at a range between 4.25 per cent and 4.5 per cent as policymakers monitored the effects of President Donald Trump’s tariffs on inflation.

“The market’s breathing a collective sigh of relief,” said Mr Adam Sarhan, of 50 Park Investments.

He expects the central bank to “go slow and steady” as it proceeds with more reductions after its September policy meeting.

Among individual companies, shares in Warner Bros Discovery surged more than 28 per cent after the Wall Street Journal reported that Paramount Skydance is preparing a majority cash bid for the company. AFP

See more on