US markets settle higher on Wednesday

10 Oct 2024 Evaluate

The US markets settled higher on Wednesday with Nasdaq ending higher by over one percent after the minutes from the Federal Reserve's September meeting showed official agreed to cut interest rates but were unsure how aggressive to get, and ultimately decided on a half percentage point move, aiming to balance confidence on inflation with worries over the labor market. The minutes said that policymakers decided to approve a jumbo rate cut of 50 basis points for the first time in more than four years, and also showed members divided over the economic outlook. Some officials hoped for a smaller, quarter percentage point reduction as they sought assurance that inflation was moving sustainably lower and were less worried about the jobs picture.

The minutes noted that the vote to approve the 50 basis point cut came in light of the progress on inflation and the balance of risks against the labor market. The minutes noted that a substantial majority of participants favored the larger move, without specifying how many were opposed. The term participants suggests involvement of the full FOMC rather than just the 12 voters. The minutes also noted that some members favored a reduction at the July meeting that never materialized. Stock specific developments, Apple Inc, Amazon, JPMorgan Chase, Oracle Corporation, Costco Wholesale Corporation, Merck, IBM, Caterpillar, Qualcomm and Texas Instruments gained 1 to 3 percent.

Dow Jones Industrial Average rose 431.63 points or 1.03 percent to 42,512, Nasdaq gained 108.7 points or 0.6 percent to 18,291.62 and S&P 500 was up by 40.91 points or 0.71 percent to 5,792.04.