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In the US, some stock indices finished at record highs on Wednesday after an unexpectedly encouraging update on inflation and reassurances from the Federal Reserve that it still sees a cut to interest rates as likely this year. S&P 500 rose 45.71 points, or 0.85 per cent, to 5,421.03 and the tech-heavy Nasdaq Composite advanced 264.89 points, or 1.53 per cent, to 17,608.44. Meanwhile, the Dow Jones Industrial Average fell 35.21 points, or 0.09 per cent, to 38,712.21 read more
 "Another day of record highs for Nasdaq, S&P 500 after inflation update, Fed decision")
US stocks rose on Wednesday, with two major indices- Nasdaq and S&P 500- clocking in record highs once again. Reuters
US stocks climbed on Wednesday after an unexpectedly encouraging update on inflation and reassurances from the Federal Reserve that it still sees a cut to interest rates as likely this year.
The S&P 500 and Nasdaq finished at record highs for the third consecutive day, with the S&P 500 rising 45.71 points, or 0.85 per cent, to 5,421.03 and the tech-heavy Nasdaq Composite advancing 264.89 points, or 1.53 per cent, to 17,608.44. Meanwhile, the Dow Jones Industrial Average fell 35.21 points, or 0.09 per cent, to 38,712.21.
The Federal Reserve left its key lending rate unchanged and pencilled in just one rate cut this year, down from the three expected in March. This decision followed a report showing inflation at 3.3 per cent last month, down 0.1 percentage point from April, and slightly below expectations.
Fed Chair Jerome Powell welcomed the inflation data but emphasised that the US central bank needs to see more “good inflation readings” before gaining sufficient confidence to consider cutting interest rates.
Momentum stocks
The Nasdaq led the major U.S. indices, gaining 1.5 per cent driven by another surge in Apple shares after the tech giant unveiled new artificial intelligence offerings. Other major AI-focused companies, including Microsoft and Nvidia, also saw significant gains.
Oracle jumped 13.3 per cent, despite mixed earnings, as analysts highlighted enthusiasm over new partnerships with OpenAI and Google. Nvidia was the strongest force pushing the S&P 500 higher, with a gain of 3.5 per cent.
Apple’s shares climbed 2.9 per cent, extending Tuesday’s strong gains, and the company briefly reclaimed its status as the world’s most valuable, dethroning Microsoft. Shares of Microsoft rose nearly 2 per cent, while AI chip leader Nvidia advanced more than 3.5 per cent.
Homebuilder D.R. Horton climbed 3 per cent, and Builders FirstSource, which sells vinyl windows, custom millwork, and other building materials, jumped 5.3 per cent.
Impact on bond market
In the bond market, the yield on the 10-year Treasury fell to 4.32 per cent from 4.40 per cent late Tuesday and from 4.60 per cent a couple of weeks ago. The two-year Treasury yield, which more closely tracks expectations for the Fed, slumped to 4.75 per cent from 4.83 per cent late Tuesday. Yields had been down even more earlier in the day.
With inputs from agencies
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English (US) ·