Friends
As we expected, the Federal Reserve cut the Fed Funds rate by a quarter of a point today to 3.50%- 3.75%. The other interesting news from the release and subsequent press conference was the introduction of buying T-bills by the Fed at a rate of $40 billion a month. After ending sales of securities, this was a bit of an unexpected announcement, and though the Fed Chair downplayed it as simply balance sheet maintenance, some might say it’s a first step back towards quantitative easing. Interesting.
As for stocks, though it appears that near future cuts are less likely, the market averages rallied on the news. By the close, the Dow Jones Industrial Average was up 497 points to finish the day at 48,057. The S&P 500 was up 46 points to close at 6,886. The Nasdaq Composite Index was up 77 points to close at 23,654. Gold was up $28 to trade at $4,265 per ounce, while oil was up $.68 to trade at $58.93 per barrel WTI.
Remember, we get some big tech/AI earnings releases from Oracle today after the close, and Broadcom tomorrow. But at least for the moment, the bulls are pleased with the results of today’s FOMC meeting. Let’s see what the rest of the week brings. Stay tuned.
Have a nice evening everyone.
