New York stocks rose as tech stocks rallied ahead of the regular Federal Open Market Committee (FOMC) meeting scheduled for next week and corporate earnings announcements.
At the New York Stock Exchange (NYSE) on the 23rd (US Eastern time), the Dow Jones 30 Industrial Average finished trading at 33,629.56, up 254.07 points (0.76%) from the battlefield.
The Standard & Poor’s (S&P) 500 Index closed at 4,019.81, up 47.20 points (1.19%) from the battlefield, and the Nasdaq Index jumped 223.98 points (2.01%) at 11,364.41.
Investors priced in corporate earnings and expectations of an easing of the pace of rate hikes by the Fed ahead of the FOMC’s regular meeting scheduled for next week.
As inflation slows, the Federal Reserve (Fed) is expected to raise the benchmark interest rate by 0.25 percentage point at the February FOMC.
The probability of a 0.25 percentage point rate hike by the Fed, reflected in the interest rate futures market, reached 99%.
The Wall Street Journal (WSJ) also predicted the previous day that the Fed would almost certainly raise interest rates by 0.25 percentage point at this meeting and would discuss when to stop raising interest rates at this meeting.
In December, Fed members expected the final rate target for this year to be between 5.00% and 5.25%. This means that if the interest rate is raised by an additional 0.25 percentage point at this meeting, it will have to be raised twice more by 0.25 percentage point in the future. But traders are expecting the Fed to raise rates by just 0.25 percentage points in February and March of this year.
As the Fed’s decision to halt rate hikes nears, Fed members are expected to discuss when to stop raising rates at this meeting. However, it is highly likely that no specific guidance will be presented, given that the market could give an easing signal and raise inflation expectations.
Mohamed El-Erian, chief economic adviser at Allianz, said the Fed should raise interest rates by 0.50 percentage points at the meeting, saying that inflation has moved from goods prices to services prices and that inflation could rise again if oil prices rise as China reopens. did. El-Erian explained that interest rates should be raised more while growth and markets are still tolerable.
On this day, Apple, and Tesla, which had fallen sharply due to the influence of Corona 19 in China, rose to expectations of economic recovery in China, and semiconductor companies showed an upward trend in Barclays’ investment opinion, and technology stocks showed a strong performance.
Apple is up more than 2%, and shares of Tesla are up more than 7%.
On this day, Barclays raised its investment opinion on semiconductor manufacturers AMD, Qualcomm, Seagate Technology, and Skyworks Solutions from ‘equal weight’ to ‘overweight’. The outlook for the semiconductor industry this year has changed positively, and the outlook for companies related to data centers, personal computers (PCs), and handsets is more positive than before.