For months, traders on Wall Street have been trying to get ahead of the Federal Reserve and guess when cuts to rates will arrive. They have already sent stock prices higher and bond yields lower in anticipation of it.
Through it all, the Fed has remained “nothing if not consistent in doing what it said it would do,” Larkin said. “Until they say otherwise, their plan is to cut rate cuts in the second half of the year.”
The immediate reaction across financial markets to the inflation data was halting and uncertain.
In the bond market, Treasury yields initially dropped and then swung higher. The yield on the 10-year Treasury eventually rose to 4.15 per cent from 4.10 per cent late on Monday.
The price of gold, which has shot to records on expectations for coming rate cuts, also swung. It was recently down 0.9 per cent at $US2,168.50 per ounce. A measure of nervousness among US stock investors was down nearly 8 per cent after squiggling up and down a few times.
On Wall Street, Oracle jumped 12.2 per cent after reporting stronger profit for the latest quarter than analysts expected.
Nvidia also rallied 5.4 per cent following a rare two-day stumble in what’s been a rocket ride amid Wall Street’s frenzy around artificial-intelligence technology. The company’s stock has grown into one of the market’s most influential because of its sudden swelling in size, and it was the single strongest force pushing the S&P 500 upward.
New York Community Bancorp rose 6.6 per cent after it said it closed its previously announced deal to raise roughly $US1.05 billion ($1.6 billion) in cash from the sale of stock. The bank has been struggling under the weight of falling prices for commercial real estate and the growing pains associated with prior acquisitions it made. Its troubles have also led to worries about trouble for the broader regional banking industry.
3M climbed 4.1 per cent after it said Bill Brown, the former chairman and CEO of L3Harris Technologies, will take over as its CEO at the start of May.
On the losing end of Wall Street was Southwest Airlines. It dropped 14.6 per cent after cutting its forecast for an important measure of revenue in the first three months of this year, partially because of lower-than-expected flying by some leisure travellers.
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It also said Boeing told the company that it will deliver fewer airplanes than expected this year. Shares of Boeing, which is facing criticism over its safety and manufacturing quality, sank 4.5 per cent.
In stock markets abroad, Japan’s Nikkei 225 slipped 0.1 per cent to retreat further from its recent records. Expectations are building that its central bank will raise interest rates, which are below zero.
Indexes jumped 3.1 per cent in Hong Kong and 1.1 per cent in London but moved more modestly elsewhere across Asia and Europe.
AP
Source Agencies
