Market Digest – Record Close Amid Fed‑Cut Cheer
Yesterday’s trading session capped a frenetic week, with the S&P 500 hitting its first all‑time high since July and the Nasdaq surging close to 3%. The buzz? The Federal Reserve’s 50‑basis‑point rate cut applied its sweet‑spot cardio to risk‑on sentiment, and the market ate it up.
What’s Driving the Bull?
- Solid growth – The economy keeps moving, and so do the earnings.
- Fed’s gentle tug – The 50‑bp dip is still in the back pocket, keeping rates low enough to keep investors smacking their funding.
- All‑time highs – Nothing screams “buy‑up” louder than a market closing in a record zone.
Despite the heat from the Fed, market dips remain shallow. Think of them as buying opportunities—Little bumps in an otherwise‑plowing file.
Beyond the Equities
Yesterday, the Bank of England (BoE) made a quiet, but pivotal move: Bank Rate stayed put and the £100 bn gulp of gilts continues. The BoE’s rate‑cut schedule is still on the “slow‑n‑steady” track with just one more 25‑bp slash expected in November.
After the BoE announcement, the GBP sprinted past the 1.33 threshold, hitting a high last seen in March 2022. The slight hawk‑ish 8‑1 vote left the market buzzing about the currency’s future against other G10 peers.
Meanwhile, the US jobless claims chart dipped to a four‑month low with 219k initial claims. That’s an odd find given the 4.4% unemployment forecast and the Fed’s cut, but the market’s giving it a run‑of‑the‑mill shrug for now.
The DXY index slid about 0.3%, buoyed by a kicker in Treasury yields. The 2‑year curve fell 3 bp while the 10‑year stayed on a sell‑off streak, widening the 2‑to‑10 spread to a fresh 13 bp.
What’s on Today’s Calendar?
- UK & Canadian retail sales releases – nothing that’s expected to throw big teeth in the markets.
- Fed’s “blackout” ends with non‑voting member Harker sharing his take; other FOMC members may join the dialogue.
- ECB President Lagarde will also speak, keeping in line with the day’s quiet tenor.
Overall, it’s a calm day. That’s not always the bullish stuff, but it keeps the markets breathing and ready for the next push.
