Gold price reaches record high
Wall Street continues to gain momentum
12.09.2024, 23:11
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Wall Street is confident that the Fed will begin raising interest rates next week – even if a major interest rate hike is becoming less likely after the latest inflation figures. The stock market is still rising, and interest-free gold is reaching a new all-time high.
The prospect of falling interest rates supported the US stock markets on Thursday. Recent inflation data, however, dampened investors’ expectations of a major interest rate hike by the US Federal Reserve. Dow Jones Index of the standard values closed 0.6 percent higher at 41,096 points on Wednesday. The technology-heavy Nasdaq rose by one percent to 17,569 points. The broadly defined S&P500 increased 0.7 percent to 5,595 positions.
Producer prices in the US rose by 0.2 percent in August. Economists surveyed by Reuters had expected an increase of 0.1 percent, after stagnation in July. “A look at today’s figures confirms that the Fed will not be as aggressive in cutting interest rates as the market expected,” said Peter Cardillo, chief market economist at Spartan Capital Securities. The futures markets expect the Federal Reserve to cut the key interest rate by 25 basis points on September 18. Only a few market participants are expecting an interest rate hike of 50 basis points. The interest rate is currently still in the range of 5.25 to 5.50 percent.
Supply fears make oil expensive
The interest rate cut fantasies drove up metal prices. Gold price marked an all-time high. The price of the precious metal rose by 1.9 percent to 2558.06 dollars. Investors were betting on a positive economic effect.
The price of oil rose significantly due to fears of prolonged production outages caused by Hurricane Francine. The North Sea variety Brent cost 2.2 percent more at 72.19 dollars per barrel. US oil WTI rose by 2.7 percent to 69.16 dollars per barrel. The hurricane is currently paralyzing about a quarter of US oil production in the Gulf of Mexico.
Moderna on diving station
Investors also added technology stocks to their portfolios. NVIDIA It rose for the second day in a row, with a gain of around two percent. According to media reports, the US government wants to allow the AI chip company to export advanced chips to Saudi Arabia. The AI fantasy has returned to the stock market with full force, said market strategist Jürgen Molnar of RoboMarkets.
Shares of Warner Bros. Discovery rose by more than ten percent. The US media group was able to extend its content distribution contract with the telecommunications company Charter Communications early.
After an optimistic annual outlook, the supermarket chain’s shares rose Kroger by 7.2 percent. The group raised the lower end of its sales forecast after a better-than-expected second quarter.
Disappointed by the vaccine manufacturer’s forecasts Moderna Investors, however, pulled the plug. The shares lost around twelve percent to a four-year low. The company’s sales expectations for next year were below analysts’ estimates at 2.5 to 3.5 billion dollars.
The shares of the chemical company Dow fell by around one percent after a lowered sales forecast for the third quarter. Dow cited problems at an ethylene cracker plant in Texas as well as higher input costs and margin pressure in Europe as reasons.
You can read everything else about today’s stock market events here.