Wall Street’s major indexes have risen as investors bet on a Federal Reserve interest rate cut in the wake of weak private sector jobs data, and hopes grew that the US and Mexico would reach an agreement to avoid US tariffs on Mexican goods. The gains extended the rally on Tuesday when Fed Chairman Jerome Powell indicated the central bank may have to react to the US trade wars, boosting rate cut hopes. Other Fed officials also hinted that a rate cut was possible.
The ADP National Employment Report on Wednesday further bolstered bets for a rate cut. US private employers hired at the slowest pace in more than nine years in May, weakness that analysts blamed on the heightening global trade tensions. The data comes ahead of more comprehensive nonfarm payrolls data from the Labor Department due out on Friday. For now, he said, the market is betting the Fed will make a precautionary rate cut in July.
The Dow Jones Industrial Average rose 207.39 points, or 0.82 per cent, to 25,539.57 on Wednesday, the S&P 500 gained 22.88 points, or 0.82 per cent, to 2826.15 and the Nasdaq Composite added 48.36 points, or 0.64 per cent, to 7575.48.Morning-Market-Note-Thursday-6th-June