NEW YORK, May 25 (FintechZoom): Markets continue their turbulence with the Dow closing higher on Wednesday after the FED showed the central bank was ready to hike the rates.
For Johan Grahn, the need to raise the rates is a weak signal because it “tells that they need to move expeditiously in case of an impending recession”
The consumer discretionary sector was responsible for much of the market’s overall gains after Nordstrom’s quarterly results were better than expected.
The 10-year inflation breakeven – a key measure of where investors expect inflation to be in 10 years – has been falling in recent weeks and is now just above the Fed’s 2% target.
In a press conference following the monetary policy statement, Fed Chairman Jerome Powell indicated that he would raise interest rates further to slow economic growth and rein in inflation.
In the conference had the 4th of May, Powell said: “[T]here is a broad sense on the committee that additional 50 basis point increases should be on the table at the next couple of meetings,”
Gold prices retreated slightly on Wednesday after a few minutes from the Federal Reserve meeting that showed the central bank would likely raise interest rates by half a percentage point in June and July.
On the stock side, instead, Nvidia missed estimates with second-quarter guidance after first-quarter results that beat expectations on both the top and bottom lines were overshadowed by the latest outlook. In any case, the investors felt positive about the stock which went up more than 5%.
Covid and Ukraine are the main reasons why the company fell short of the estimate of 8.44$ billion of which 500$ million hit due to Russia’s invasion and China lockdowns.
