U.S. Stock Market Hits Record Highs Amid Lower Inflation Expectations
The major indices on the New York Stock Exchange closed at all-time highs as the U.S. Consumer Price Index (CPI) for September fell short of expectations, fueling hopes for a rate cut by the Federal Reserve (Fed).
On October 24, the Dow Jones Industrial Average rose by 472.51 points (1.01%) to close at 47,207.12. The Standard & Poors 500 index increased by 53.25 points (0.79%) to finish at 6,791.69, while the Nasdaq Composite gained 263.07 points (1.15%) closing at 23,204.87. All three indices set new intraday and closing records.
The anticipation of a rate cut due to slowing inflation has spurred a preference for riskier assets.
The U.S. Department of Labor reported that the CPI for September rose by only 0.31% compared to the previous month, falling short of the market expectation of a 0.4% increase and the prior months increase of 0.38%.
Excluding the volatile food and energy sectors, the core CPI saw a rise of 0.23%. On an annualized basis, this figure is close to the Feds inflation target.
Particularly noteworthy is the housing cost, which increased by only 0.2% compared to the previous month, marking the lowest increase since January 2021, drawing attention from the market.
Chris Zaccarelli, Chief Investment Officer at Independent Advisor Alliance, commented, "The Fed is cutting rates, and this report gives no reason to prevent a 25 basis point cut. With corporate profits on the rise, its hard to find a reason for the bull market to stop this year."
With expectations of liquidity expansion, most major tech companies with market capitalizations exceeding $1 trillion saw gains. Nvidia rose by 2.25%, Broadcom by 2.86%, and Alphabet by 2.67%. However, Tesla saw a decline of 3.4%.
The semiconductor sector also showed resilience amid the bullish sentiment in the market.
On October 24, the Dow Jones Industrial Average rose by 472.51 points (1.01%) to close at 47,207.12. The Standard & Poors 500 index increased by 53.25 points (0.79%) to finish at 6,791.69, while the Nasdaq Composite gained 263.07 points (1.15%) closing at 23,204.87. All three indices set new intraday and closing records.
The anticipation of a rate cut due to slowing inflation has spurred a preference for riskier assets.
The U.S. Department of Labor reported that the CPI for September rose by only 0.31% compared to the previous month, falling short of the market expectation of a 0.4% increase and the prior months increase of 0.38%.
Excluding the volatile food and energy sectors, the core CPI saw a rise of 0.23%. On an annualized basis, this figure is close to the Feds inflation target.
Particularly noteworthy is the housing cost, which increased by only 0.2% compared to the previous month, marking the lowest increase since January 2021, drawing attention from the market.
Chris Zaccarelli, Chief Investment Officer at Independent Advisor Alliance, commented, "The Fed is cutting rates, and this report gives no reason to prevent a 25 basis point cut. With corporate profits on the rise, its hard to find a reason for the bull market to stop this year."
With expectations of liquidity expansion, most major tech companies with market capitalizations exceeding $1 trillion saw gains. Nvidia rose by 2.25%, Broadcom by 2.86%, and Alphabet by 2.67%. However, Tesla saw a decline of 3.4%.
The semiconductor sector also showed resilience amid the bullish sentiment in the market.
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