SPX: S&P 500 Blasts Off to New Record After Powell Speech Boosts Rate-Cut Optimism

Fed boss said the central bank was “not far” from slashing borrowing costs in order to support economic activity.

Key Points:

• S&P 500 took off to new record.
• Powell said rate cuts will begin soon.
• Markets figured he probably meant June.
• The S&P 500 (SPX) soared to a fresh all-time high Thursday after remarks from Federal Reserve Chairman Jay Powell infused confidence in emboldened traders. The broad-based index added 1%, or 52 points, to sign off at 5,157. It was the Wall Street benchmark’s 16th record close for the year.
• The other two stock averages also took off with the Nasdaq Composite pumping the most—up 1.5%—to 16,273 points. The Dow Jones Industrial Average was moderate in its work, adding 0.3% to 38,791. The sheer power concentrated in a single person helped steer the rally.
• Jay Powell told the Senate Banking Committee yesterday that interest-rate cuts “can and will begin this year”. What’s more, the top central banker said to lawmakers that the Fed was “not far” from launching its rate-reduction campaign. And now traders eye the Fed’s June meeting as a good spot for kicking off the initiative.