Stock Market: Dow Climbs Over 400 Points As Wall Street Cheers Powell's Announcement Of Fed Rate Cuts On The Way

Traders work on the floor of the New York Stock Exchange (NYSE) during morning trading in New York on August 23, 2024. US Federal Reserve Chair Chair Jerome Powell said on August 23 that the “time has come” for the US to start cutting interest rates, adding that his “confidence has grown” that the battle against inflation is on track. “The time has come for policy to adjust,” he said in a keynote speech at the Jackson Hole Economic Symposium in Wyoming, according to prepared remarks. (Photo by ANGELA WEISS/AFP via Getty Images)

OAN Staff James Meyers
11:38 AM – Friday, August 23, 2024

Wall Street’s stock indexes increased substantially on Friday, with the S&P 500 index climbing towards a record high, after Federal Reserve Chair Jerome Powell said “the time has come” to reduce interest rates.

At an important annual economic conference in Jackson Hole, Powell endorsed imminent policy easing citing risks in the job market and inflation getting closer to the Fed’s 2% target.

In trading, the Dow Jones Industrial Average increased 460 points, or 1.1%, to 41,173. The S&P 500 increased 1%, with the Nasdaq climbing 1.3%.

As a result of the recent trading, the three major indexes were on track for their second straight week of gains.

The S&P 500 extended early gains and was just less than 1% away from overtaking a record high clinched in July, after plummeting as much as 9.7% from that level earlier in August.

Meta and Amazon jumped 1% each, boosting the index, while chip stocks such as Nvidia and Broadcom rose more than 3% each.

Additionally, all S&P 500 sectors advanced, led by a 1.4% increase in technology stocks, as the Philadelphia chip index rose 2.2%.

Meanwhile, the Fed is scheduled to meet on September 17^th and 18^th, with traders pricing in a 71.5% chance that the central bank will cut borrowing costs by 25 basis points, according to CME Group’s FedWatch tool.

“The market has been predicting the first rate cut to start going back to March of this year and investors have been disappointed multiple times,” said Sam Stovall, chief investment strategist at CFRA Research in New York.

“The only question is by how much and, unlike the sprinters in the Olympics, the Fed will not explode out of the blocks with a 50-basis-point cut.”

Minutes from the Fed’s July meeting this week showed a number of lawmakers were ready to consider rate cuts in September.

That has helped Wall Street’s three main indexes recover from a significant downfall earlier this month after a poor July employment report was revealed.

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