Nasdaq ends at record as markets eye US interest rate relief
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A trader works on the floor at the New York Stock Exchange on Sept 8.
PHOTO: BLOOMBERG
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The Nasdaq finished at a fresh record on Sept 8 as major equity indices advanced in hopes that benign US inflation data will lead to Federal Reserve interest rate relief.
“Investors are feeling that lower interest rates lie ahead,” said Mr Sam Stovall, chief investment strategist at CFRA Research.
The tech-rich Nasdaq Composite Index climbed 0.5 per cent to 21,798.70, eclipsing a record set in August.
The Dow Jones Industrial Average added 0.3 per cent at 45,514.95, while the broad-based S&P 500 edged up 0.2 per cent to 6,495.15.
After Sept 5’s weak jobs data added to expectations for a Federal Reserve interest rate cut later in September, markets are fixating on this week’s consumer and producer price reports.
Expectations that the Fed would soon cut rates grew after Fed Chair Jerome Powell’s Aug 23 address at the central bank’s Jackson Hole gathering signaled a pivot.
Mr Powell had previously argued the Fed could keep rates unchanged in light of inflation that has lingered above the Fed’s long-term target level while the US economy chugged along.
But the weakening of the jobs market has led more policymakers to argue the need to cut rates to forestall further deterioration.
“I think the Fed has locked itself into cutting rates in September,” Mr Stovall said. “The only outlying question based on future economic reports(...) is, will they cut once, twice or three times this year?“
Among individual companies, Robinhood Markets jumped 15.8 per cent after the trading company was added to the S&P 500 index. AFP
