WALL STREET ENDS
by Caroline Valetkevitch
NEW YORK (Reuters) – The New York Stock Exchange ended sharply higher on Wednesday after the Federal Reserve (Fed) decided to raise interest rates by 75 basis points as expected, with comments from the Federal Reserve Governor also reassuring investors.
The Dow Jones Industrial Average rose 1.37%, or 436.05 points, to 32,197.59 points.
The broader S&P 500 gained 102.56 points, or 2.62%, to 4,023.61 points.
For its part, the Nasdaq Composite rose 469.85 points (4.06%) to 12,032.42 points.
Major Wall Street indices were already in the green ahead of the Fed’s statement, helped by strong results from Microsoft and Alphabet the day before the close, boosting investor confidence.
The Nasdaq posted its strongest one-day percentage gain since April 2020, while the S&P 500 has posted a record close since June 8.
During a press conference, the Fed chairman stated that he believes the US economy is not currently in recession but is slowing down.
Jerome Powell added that the lack of long-term visibility for the economy means the Fed can only provide clear monetary policy direction “from meeting to meeting”.
“Powell’s willingness to let the data guide him (Fed officials) has pleased the market,” commented Peter Tuz, president of Chase Investment Counsel in Charlottesville, Virginia.
“He didn’t say that we automatically need another rate hike,” he added, noting the comforting nature of the Fed’s comments.
Similar to last month, and after small hikes in March and May, the Fed decided to raise interest rates by 75 basis points as part of its effort to dampen inflation, which has been at multi-decade highs.
Microsoft rose 6.7% after announcing it expects double-digit revenue growth at the end of the current fiscal year.
Alphabet rose 7.7% the day after its Google search engine posted better-than-expected ad sales, easing concerns about a slowing ad market.
(French version Jean Terzian)