Wall Street’s three major stock indexes closed at record highs for the second day in a row on Thursday, while Micron Technology Semiconductor stocks rebounded on the positive outlook.
The Dow Jones Industrial Average rose 269.24 points, or 0.7%, to 39,781.37, the S&P 500 rose 0.2% and the Nasdaq rose 0.3%.
The three major indexes hit new intraday highs, and the Dow Jones Industrial Average approached the 40,000 dollar mark.
Chipmaker Micron Technology soared 14% to a record high after posting a surprise quarterly profit and forecast that third-quarter sales would beat expectations.
Peer Nvidia rose 1% and the Philadelphia Semiconductor Index rose 2.9%.
Stock indexes closed higher on Wednesday after central bankers said they expected to keep borrowing costs unchanged and ease interest rates by three-quarters of a percentage point by the end of 2024.
“While the results show that semiconductors retain their market leadership position, more broadly Wednesday’s dovish Fed stance has led to a risk-on trend,” said Matthew Miskin, co-chief investment strategist at John Hancock Investment Management. A mode is emerging.”
Fed Chairman Jerome Powell said at a press conference after Wednesday’s policy meeting that the inflation report shows that “the overall picture hasn’t changed much, which means that inflation will gradually decline toward 2%, along a sometimes bumpy path.” It means that we are doing well,” he said.
But John Hancock’s Miskin questioned whether the Fed was being too optimistic about inflation and interest rate cuts.
“They’re opening the door for inflation risk to seep back into the market. We’re not there yet, but that risk could emerge later this year,” he said.
Markets are currently pricing in a 70% chance that the Fed will cut rates in June, compared to about 56% expected earlier in the week, according to the CME FedWatch tool.
UBS Global Research said it now expects the first rate cut to occur in June, compared to its initial forecast of a May rate cut.
However, economic data released early on Thursday further reinforced investors’ bullish mood.
In a separate measure, the preliminary U.S. composite PMI production index, which tracks manufacturing and services, stood at 52.2 this month, compared with 52.5 in February.
Most interest rate-sensitive growth and tech stocks also rose.
However, Apple fell 4% after the Justice Department filed an antitrust lawsuit against the company.
IT services provider Accenture fell 9% after the company lowered its fiscal 2024 revenue forecast as uncertain economic conditions prompted clients to cut spending on consulting services.
Broadcom rose 5.6% after TD Cowen upgraded its rating to “outperform.”
Reddit shares soar 48% on the New York Stock Exchange under the ticker “RDDT” after the social media platform set its initial public offering price at the high end of its target range of $31 to $34 per share did.
