Wednesday, November 28, 2018
Federal Reserve President Powell brings Wall Street the best day in three weeks. The Fed chief estimated the US interest rates below the neutral level. At the beginning of October, he saw the Fed's monetary policy far from this neutral point.
Reduction of concern over the tightening of money in the US and the hope for a solution to the US-China trade dispute prompted Wall Street on Wednesday. US Federal Reserve Chairman Jerome Powell earlier said in New York that his policy of increasing growth rates was aimed at balancing the risks.
The current key interest rate range of 2.0 to 2.25 percent is "slightly below" the estimated neutral level, with which the economy is not being promoted or slowed down. This suggests that there may not be such an increase in interest rates as investors expect, economist Jack Ablin of Cresset's wealth adviser said. Other analysts say Pauel said a month and a half ago that the Fed is far from neutral interest rates: "It's a dramatic turning point," said Walter Todd of Greenwood Capital. With Powell's statements, the dollar was under heavy pressure. The euro has risen by about one US cent and lasted 1.1370 dollars.
The Dow Jones Standard Index rose 2.5 percent to 25,366 points. The wider S & P 500 rose 2.3 percent to 2,743. Nasdaq's technology exchange index is now below 3 percent to 7291 posts.
Before Pauel's remarks, Dow had just over one percent plus. It was supported by statements by US Finance Minister Donald Trump, who said that the Trump meeting with Chinese President Xi Jinping on Saturday in Buenos Aires would be understood as an opportunity to "turn things around" in a trade dispute with China. Adviser Larry Kudlow added that until now Trump is disappointed with the reaction of China. Nevertheless, the focus was on the optimistic aspect of the stock market statement.
Any indication of the dispute resolution could encourage global growth, said Kim Forrest, a fund manager, from the Fort Pitt Capital Group. In terms of individual stocks, Tiffany was under pressure. The jeweler was influenced by the hostility of Chinese buyers to buy. Shares fell to 12.1 percent after quarterly overheads. The looks of Tiffany were less optimistic than they hoped.
However, thanks to the buzzing of the cloud, the Salesforce software vendor surpassed analysts' expectations. Works increased by 10.1 percent. Also, Microsoft's shares rose sharply – by 3.8 percent.