Nasdaq surpasses 17,000 mark ahead of inflation test By Reuters

adminMay 28, 2024

By Johann M Cherian and Lisa Pauline Mattackal

(Reuters) – The Nasdaq topped the 17,000 level for the first time on Tuesday. The Nasdaq rose as AI darling Nvidia (NASDAQ:) jumped to an all-time high, rattling expectations of key inflation data later this week. The Fed’s interest rate cut path.

Nvidia’s gains lifted fellow chip stocks, with the Philadelphia Semiconductor Index rising 1.7% as traders returned from the holiday weekend.

The Dow lagged other indexes as health care and financial stocks fell. Healthcare also led the subsector losses, down 8%. modern (NASDAQ:) .

The possibility that the world’s most powerful central bank could start cutting interest rates this year has sent Wall Street into a record rally since the end of 2023, with the Nasdaq and S&P 500 posting their fifth straight week of gains on Friday.

But expectations for the timing of a rate cut have been ticking and policymakers are wary as data still reflects stubborn inflation.

Market attention now turns to the April US core personal consumption expenditures price index report later this week. The Federal Reserve’s preferred measure of inflation is expected to remain stable from month to month.

“The investment community has come to accept that the Fed is unlikely to cut interest rates in 2024. As we anticipate the next round of economic data, investors will look to see whether these results will reinforce the shift in opinion that interest rates will be cut. “There will be no interest rate cuts this year,” said Peter Anderson, founder of Anderson Capital Management.

According to the CME FedWatch Tool, the odds of a rate cut of at least 25 basis points exceeded 50% in November and December of this year alone.

U.S. trading will move to shorter settlements on Tuesday, which regulators hope will reduce risk and improve efficiency, but is expected to temporarily increase trade failures for investors.

Minneapolis Federal Reserve President Neel Kashkari told CNBC the U.S. central bank should wait before cutting interest rates, adding that it could potentially raise rates if inflation no longer falls.

At 11:29 a.m., it was down 130.37 points, or 0.33%, at 38,939.22, while the S&P 500 was up 3.92 points, or 0.07%, at 5,308.64 and up 87.15 points, or 0.52%, at 17,008.27.

UBS Global Research raised the year-end target for the benchmark index from the previous forecast of 5,400 to 5,600, recording the highest forecast among major securities companies.

Apple (NASDAQ:) rose nearly 0.9% after iPhone sales in China surged 52% in April compared to a year earlier, according to Reuters calculations based on industry data.

Shares of United States Cellular (NYSE:) rose 3% after T-Mobile announced it would acquire substantially all of the regional carrier’s wireless operations in a $4.4 billion deal.

GameStop (NYSE:) soared 24% after the video game retailer announced late Friday that it had raised $933 million by selling 45 million shares as part of a “market” public offering.