NEW YORK: Wall Street’s main indexes rose for a fourth consecutive session on Wednesday, as investors doubled down on bets the Federal Reserve will cut interest rates in December.
Tech stocks were in the lead following AI-server maker Dell’s strong forecasts, helping the S&P 500 and the Nasdaq touch two-week highs.
Investors were also digesting mixed economic data after jobless claims fell last week, while new orders for capital goods surged in September.
“The economy isn’t slipping into recession, but it’s weak enough to allow the Fed another cut. There’s still a high amount of people that are on unemployment, so this gives the Fed headroom to be able to cut some more,” said Kim Forrest, chief investment officer at Bokeh Capital Partners.
On the back of softer consumer demand signals and dovish remarks from key Fed officials, traders are now pricing in an 84.9 percent chance of a 25-basis-point rate cut next month - nearly double last week’s odds, CME’s FedWatch tool showed.
Focus will now be on the central bank’s snapshot of economic conditions, called the Beige Book, expected at 2 p.m. ET.
Investors were also weighing a report suggesting White House economic adviser Kevin Hassett was a frontrunner to be the next Fed Chair, at a time when political influence in monetary policymaking has been a concern.
At 11:25 a.m. ET the Dow Jones Industrial Average rose 359.66 points, or 0.76 percent, to 47,472.11, the S&P 500 gained 55.61 points, or 0.82 percent, to 6,821.49 and the Nasdaq Composite gained 212.96 points, or 0.93 percent, to 23,238.55.
Wall Street’s recent recovery from a tech-led selloff earlier this month has trimmed monthly losses on the main indexes. It would still be their biggest monthly losses since the US tariff rout earlier this year.
Lifting some of the gloom on Wednesday was a 5.8 percent rise in Dell after its quarterly forecasts surpassed expectations, supported by strong demand for its servers in AI data centers.
Tech stocks rose 1.4 percent and led broad sectoral advances on the S&P 500, while chip stocks added 2.8 percent and Nvidia climbed 1.2 percent.
Advancing issues outnumbered decliners by a 3.71-to-1 ratio on the NYSE and by a 2.02-to-1 ratio on the Nasdaq.
The S&P 500 posted 27 new 52-week highs and no new lows while the Nasdaq Composite recorded 99 new highs and 37 new lows.
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