NEW YORK: US stocks jumped higher in early trading Thursday, boosted by renewed hopes the international inflationary picture could be improving after the European Central Bank cut its inflation and growth outlooks.
Although the ECB held interest rates steady on Thursday, its inflation outlook suggests price pressures are likely to ease in Europe faster than previously thought.
This could bode well for the Fed, which has raised its key lending rate to a 23-year high as it looks to tame inflation and return it firmly to its long-term target of two percent.
Wall St rises after Powell signals rate cuts this year
Around 15 minutes after trading began on Wall Street, the Dow Jones Industrial Average was up 0.5 percent at 38,843.52.
The S&P 500 rose 0.6 percent to 5,134.09, while the tech-rich Nasdaq Composite rose by the same amount to 16,120.17.
“The market remains exceptionally strong,” Adam Sarhan from 50 Park Investments told AFP.
“We’ve had every chance in the world to fall, and instead we continue to just consolidate and or rally,” he said. “That tells us that the big investors, the big institutions are in there buying the dips.”
While the overall market rose, there was bad news for US lingerie retailer Victoria’s Secret, whose share price plummeted more than 27 percent after it reported lower than expected sales guidance.
There was some good news for the under-pressure regional bank New York Community Bancorp, whose share price surged more than 13 percent after announcing a $1 billion capital injection led by former US Treasury Secretary Steven Mnuchin.
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