By CCN.com: The Dow and broader U.S. stock market extended their winning streaks on Thursday, as Federal Reserve officials began preparations for a high stakes ...
By CCN.com: The Dow and broader U.S. stock market extended their winning streaks on Thursday, as Federal Reserve officials began preparations for a high stakes policy meeting later this month. If the Fed is willing to cut interest rates in July as markets believe, then evidence to that effect will likely materialize later this month.
All of Wall Street’s major indexes traded in positive territory on Thursday, extending their winning streak to three days. The Dow Jones Industrial Average climbed 181.09 points, or 0.7%, to 25,720.66.
The broad S&P 500 Index of large-cap stocks gained 0.6% to 2,843.49. All 11 primary sectors reported gains, led by energy stocks.
Meanwhile, the technology-focused Nasdaq Composite Index gained 0.5% to 7,615.55.
Members of the Federal Reserve’s policy-setting board have already begun preparations for their upcoming meeting on June 18-19.
Central bankers gathered in Chicago this week for a policy conference hosted by the Federal Reserve Bank of Chicago. It was at this venue that Chairman Jerome Powell gave his clearest signal yet that officials are open to lowering interest rates to soften the blow of a drawn-out trade war with China.
“We do not know how or when these trade issues will be resolved,” Powell said Tuesday, referring to stalled U.S.-China trade negotiations. “We are closely monitoring the implications of these developments for the U.S. economic outlook and, as always, will act as appropriate to sustain the expansion.”
According to Fed Fund futures prices, there’s only a 22.5% chance that the central bank lowers interest rates this month. The likelihood jumps to more than 70% in July.
With the U.S. economy careening lower at the start of the second quarter, investors are convinced that rate hikes are out of the question for the foreseeable future. On Wednesday, market participants got a glimpse of what appears to be a slowing jobs market after ADP reported the weakest pace of hiring in nearly nine years.
The Department of Labor is set to release the official nonfarm payrolls report Friday at 8:30 a.m. ET. Analysts are still holding on to forecasts calling for a net gain of 185,000 jobs last month. On Wednesday, ADP reported a gain of just 27,000 private-sector payrolls for May.
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