Wall Street Rallies as Fed Holds Rates, Eyes Job Report

Wall Street's primary indices surged on Thursday following the Federal Reserve's decision to maintain interest rates, alleviating concerns regarding potential rate hikes. Attention now turns to the forthcoming job report, expected to provide crucial insights into the labor market and future interest rate trajectories.

Federal Reserve Chair Jerome Powell's remarks, indicating a postponement of anticipated rate cuts due to persistent inflation, contributed to market optimism. Despite inflationary pressures, Powell dismissed discussions of rate hikes, further boosting investor confidence.

Market sentiment reflects a heightened anticipation of rate cuts, with money markets pricing in a 58% probability of a rate cut in September and a higher 68.4% likelihood of a cut in November, according to the CME FedWatch tool.

Brian Nick, Senior Investment Strategist at the Macro Institute, noted, "The outcome of the Fed statement, plus the press conference, resulted in slightly more rate cuts being priced in, albeit not necessarily sooner, but by the year's end."

While Wednesday initially saw a rise in US stocks following the Fed's decision, both the S&P 500 and the Nasdaq closed lower for the day.

The labor market remains robust, with new claims for unemployment benefits holding steady at a low level. Additionally, new orders for US-manufactured goods increased in March in line with economists' expectations.

Investor attention now centers on the upcoming nonfarm payrolls data, expected to provide further clarity on the labor market's trajectory and its impact on interest rates.

Among S&P 500 companies reporting earnings, a notable 77.4% have exceeded estimates, surpassing the historical average of 67%, according to LSEG data.

As of 10:01 a.m. ET, the Dow Jones Industrial Average rose 69.56 points, the S&P 500 gained 5.60 points, and the Nasdaq Composite gained 51.79 points.

Key gainers included Apple, Qualcomm, Carvana, and MGM Resorts, while DoorDash and Etsy faced declines.

Advancing issues outnumbered decliners on both the NYSE and Nasdaq, with new highs recorded for the S&P 500 and Nasdaq indices.

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