Connect with us
Finance Digest is a leading online platform for finance and business news, providing insights on banking, finance, technology, investing,trading, insurance, fintech, and more. The platform covers a diverse range of topics, including banking, insurance, investment, wealth management, fintech, and regulatory issues. The website publishes news, press releases, opinion and advertorials on various financial organizations, products and services which are commissioned from various Companies, Organizations, PR agencies, Bloggers etc. These commissioned articles are commercial in nature. This is not to be considered as financial advice and should be considered only for information purposes. It does not reflect the views or opinion of our website and is not to be considered an endorsement or a recommendation. We cannot guarantee the accuracy or applicability of any information provided with respect to your individual or personal circumstances. Please seek Professional advice from a qualified professional before making any financial decisions. We link to various third-party websites, affiliate sales networks, and to our advertising partners websites. When you view or click on certain links available on our articles, our partners may compensate us for displaying the content to you or make a purchase or fill a form. This will not incur any additional charges to you. To make things simpler for you to identity or distinguish advertised or sponsored articles or links, you may consider all articles or links hosted on our site as a commercial article placement. We will not be responsible for any loss you may suffer as a result of any omission or inaccuracy on the website.


Wall St rallies, dollar drops after cooler US inflation; Fed in the wings

Wall St rallies, dollar drops after cooler US inflation; Fed in the wings

By Stephen Culp

NEW YORK (Reuters) -U.S. stocks rallied and the dollar sank as cooler-than-expected inflation data fueled rate cut optimism, hours before the end of the U.S. Federal Reserve’s monetary policy meeting.

Benchmark U.S. Treasury yields were sharply lower after the Labor Department’s closely watched CPI report showed core prices growing at their slowest annual pace in over three years.

“I’m very impressed with the core year-over-year coming in at 3.4%,” said Peter Cardillo, chief market economist at Spartan Capital Securities in New York. “It is playing into the hands of the Fed in the sense they’re data dependent.”

Cardillo expressed doubt that the report will alter the Fed’s rate decision expected later in the session, but added that “it’s obviously a comforting number”.

All three major U.S. stock indexes were sharply higher, with the tech-laden Nasdaq leading.

The cooler-than-expected inflation print comes as welcome news as members of the Federal Open Markets Committee (FOMC) approach the end of their June meeting.

While they are widely expected to leave the key Fed funds target rate unchanged at 5.25%-5.50%, the central bank is also expected to release its Summary of Economic Projections which should show, among other things, the number of rate cuts it expects this year, otherwise known as the dot plot.

“If the dot plot should indicate two rate cuts this year, most likely in the latter part of the year, that would be very welcome news for the market,” Cardillo said.

At last glance, financial markets are pricing in a 62.0% likelihood of a 25 basis point rate cut in September, up from 46.8% on Tuesday, according to CME’s FedWatch tool.

The Dow Jones Industrial Average rose 195.92 points, or 0.51%, to 38,943.34, the S&P 500 gained 66.92 points, or 1.24%, to 5,442.24 and the Nasdaq Composite added 315.86 points, or 1.82%, to 17,659.40.

European shares, already in positive territory in advance of the data, surged after the CPI report.

The pan-European STOXX 600 index rose 1.20% and MSCI’s gauge of stocks across the globe gained 1.28%.

Emerging market stocks rose 0.49%. MSCI’s broadest index of Asia-Pacific shares outside Japan closed 0.66% higher, while Japan’s Nikkei lost 0.66%.

The dollar tumbled against a basket of world currencies on mounting bets the Fed could issue its first interest rate cut as early as September.

The dollar index fell 0.73%, with the euro up 0.93% to $1.0839.

The Japanese yen strengthened 0.77% versus the greenback at 155.90 per dollar, while Sterling was last trading at $1.2849, up 0.86% on the day.

U.S. benchmark 10-year Treasury notes last rose 33/32 in price to yield 4.2752%, from 4.402% late on Tuesday.

The 30-year bond last rose 46/32 in price to yield 4.4491%, from 4.535% late on Tuesday.

Oil prices advanced, supported by forecasts that global inventories will fall in the latter half of the year.

U.S. crude rose 1.59% to $79.14 per barrel and Brent was last at $83.21, up 1.57% on the day.

Gold gained ground in advance of the Fed’s policy statement and updated economic projections.

Spot gold added 0.5% to $2,328.49 an ounce.

(Reporting by Stephen Culp; Additional reporting by Amanda Cooper in London; Editing by Alexander Smith)

Continue Reading

Why pay for news and opinions when you can get them for free?

       Subscribe for free now!

By submitting this form, you are consenting to receive marketing emails from: . You can revoke your consent to receive emails at any time by using the SafeUnsubscribe® link, found at the bottom of every email. Emails are serviced by Constant Contact

Recent Posts