Fed cuts rates, stocks hit record

US stocks rose Monday, with the Dow Jones Industrial Average and S&P 500 eking out record closes.

The S&P 500 closed at an all-time high today for the 40th time this year. $SPX

Video: https://t.co/QjWDUVXri5 pic.twitter.com/7bXL7xh8eg

— Charlie Bilello (@charliebilello) September 24, 2024

Investors looked to Federal Reserve speakers and a key inflation reading for clues to the likelihood of another big rate cut. The Dow rose more than 0.1% after closing at an all-time high on Friday. The S&P 500 edged up more than 0.2% to finish at its own record. The tech-heavy Nasdaq Composite climbed 0.1%.

* S&P 500 HITS FRESH INTRADAY RECORD HIGH@reuters $SPX 🇺🇸 pic.twitter.com/5u3ZvO82V5

— Carl Quintanilla (@carlquintanilla) September 24, 2024

The market is grappling with concerns about the health of the US economy, which have persisted after the Fed’s pivot to cutting interest rates last week. The big question now is whether economic data will support Fed Chair Jerome Powell’s assertion that conditions remain strong.

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— LyondellBasell (@LyondellBasell) September 23, 2024

Much will depend on Friday’s reading on the PCE index, the Fed’s preferred inflation gauge, and Thursday’s second-quarter GDP print. Positive data could give policymakers the green light for another 0.5% cut this year. Investors received more policy insight from Fed officials on Monday morning. Raphael Bostic and Neel Kashkari expressed their support for a larger initial rate cut, citing progress on inflation and a cooling job market. Given the rare lack of unanimity in the last decision, remarks from Powell and dissenting Fed governor Michelle Bowman later in the week are likely to be closely scrutinized. Among Monday’s movers, Tesla stock rose on positive outlooks from Wall Street ahead of the electric vehicle maker’s robotaxi day in October. Tesla shares jumped over 4% on Monday. The company will unveil its driverless cabs on Oct.

Fed’s big rate cut impacts market

10 and announce its third-quarter sales figures, with analysts forecasting a 6% increase in sales to about 460,000 EVs. Intel stock also rose by more than 4% following a Bloomberg report that private equity firm Apollo Global Management has offered to invest up to $5 billion in the struggling chipmaker—a vote of confidence in its turnaround strategy. Boeing shares increased by 2% after it reportedly raised its contract offer to the machinists union to end a strike, proposing a 30% wage increase over four years, up from a prior proposal of 25%. Boeing shares had been hovering around 52-week lows recently. In other news, GM stock dropped on a Bernstein downgrade. Lead autos analyst Daniel Roeska warned investors about several headwinds that could dampen the stock’s run. Bernstein downgraded GM stock to Market Perform from Outperform. House Republicans are working to avert a government shutdown this week, potentially keeping the government open until Dec. 20. Bank of America announced plans to open 165 new branches by the end of 2026, joining other big US lenders like JPMorgan Chase in expanding brick-and-mortar locations. Microsoft stock received a rare downgrade over concerns the tech giant is too reliant on Nvidia for its AI infrastructure, while competition has caught up. Analysts at D.A. Davidson downgraded the stock to Neutral. Trump Media & Technology Group stock dropped another 6% on Monday after the company’s six-month lock-up period expired. Shares are down roughly 15% since last Thursday. Overall, US stocks drifted higher on Monday, with the Dow and S&P 500 notching new record closes as the September rally continued.