Dow Jones closes in positive territory
Investors are hoping for new records on US stock markets
February 12, 2024, 10:13 p.m
A sharp decline in inflation could pave the way for new highs for stocks on Wall Street. However, the US Federal Reserve has curbed expectations for rapid interest rate cuts. When it comes to individual values, the chip manufacturer Nvidia is causing a stir.
The hope of a further cooling of inflation has created a buying mood on the US stock exchanges. The Dow Jones Index the standard values increased by 0.33 percent to 38,797.38 points. The broader one S&P 500 remained hardly changed at 5021.84 points. Also the index of the technology exchange Nasdaq recorded 0.3 percent less at 15,942.55 jobs.
We were just under one percent short of the all-time high. Tuesday’s inflation data release promises to be the most important event of the week, said Chris Beauchamp, chief market analyst at IG. “Inflation is expected to move further towards the Fed’s target, and investors are therefore hoping for a sharper decline in inflation, which could be the basis for new records on US stock markets.”
Investors hope that the inflation data will provide insight into the Fed’s future course. However, recent data pointed to a robust economy and central bankers have tempered expectations for rapid interest rate cuts. This is also reflected in the market: The probability that interest rates will be cut by at least 0.25 percentage points in May is now estimated to be significantly lower than at the beginning of 2024, as can be seen from the CME FedWatch calculator.
Nvidia overtakes Amazon in market valuation
When it came to the individual values Nvidia caused a stir: The chip manufacturer has overtaken Amazon in terms of market valuation and is now number four among the most valuable US companies. The euphoria around the topic of artificial intelligence plays a particularly important role – Nvidia is particularly strong on this topic.
“Some have assumed in recent weeks that we would see a correction in semiconductor stocks, and that hasn’t happened,” said Joe Saluzzi, trader at Themis Trading. “And that’s why now people are saying that they don’t want to miss the good development from last year again,” he added.
Joby Aviation increased 6.75 percent. The manufacturer of electric aircraft wants to put air taxis into operation in Dubai in the coming years and has signed an agreement with the responsible authorities.