US stocks hit new high

The S&P 500 closed at a record high, helped by a surge in tech stocks and expectations of a Fed rate cut this year.

At the close of trading on January 19, the S&P 500 rose 1.2% to 4,839 points. This is a new peak, surpassing the old record of 4,796 points at the beginning of 2022.

Tech stocks led the gains, rising 2.4%. AI-related stocks surged. Nvidia added 4.2% to a new high. Meta Platform also hit a record $383 a share.

Similarly, the DJIA index increased by 1.1%, closing at a new peak of 47,863 points.

After a turbulent start to the year, the S&P 500 has stabilized. It is up 1.5% so far. Last year, it was up 24%, mostly toward the end of the year. Investors were optimistic that the Federal Reserve could help the country achieve a soft landing, or curb inflation without triggering a recession.

At its policy meeting last month, the Fed forecast three rate cuts next year, a surprise turn in its fight against inflation. The agency has also kept rates unchanged for the past six months, signaling that it has completed its rate hikes.

Since the beginning of the month, comments from several Fed officials have dampened investor expectations of a March rate hike. Atlanta Fed President Raphael Bostic said on January 18 that he did not believe the Fed would cut rates in the first half of the year. A few days earlier, Fed Board of Governors member Christopher Waller also said they would not rush to cut rates.

However, on January 19, Chicago Fed President Austan Goolsbee gave investors more hope when he said the agency should consider cutting interest rates if inflation continues to decline. "If inflation continues to develop in unexpected, better-than-expected ways, we will reconsider the level of tightening," he told CNBC.

Ha Thu (according to Reuters, CNN)

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