Stocks in the United States achieve unprecedented heights following the Federal Reserve's interest rate decrease, with Intel's stellar performance attributed to its investment in Nvidia.
In a significant move, the Federal Reserve announced a 25 basis point interest rate cut on Thursday, marking the first rate reduction of 2025. This decision has provided fresh momentum for the markets, with all major indices reaching new record highs.
The Dow Jones Industrial Average rose 0.3%, closing at 26,142.42. The S&P 500 followed suit, gaining 0.5%, closing at 6,631.96. The Nasdaq Composite also saw a strong performance, jumping 0.9%, closing at 22,470.73.
The market rally was not just a reaction to the Fed's decision, but also due to promising developments in key technology sectors. One such development is Nvidia's $5 billion investment in Intel, which sent Intel shares soaring nearly 23 percent. Nvidia's stock, too, climbed 3.5 percent on the news.
Another significant development came from the cybersecurity firm CrowdStrike. Their presentation on AI data protection capabilities led to a 12.8 percent surge in its shares, with several equity analysts raising their price targets for the company.
The direction of interest rates, according to analyst Angelo Kourkafas of Edward Jones, is likely to be lower. However, future decisions will depend on broader economic conditions. Economic resilience could limit the extent of monetary easing ahead, Kourkafas noted.
In a separate development, the White House asked the Supreme Court for an emergency order to oust Fed Governor Lisa Cook. However, the US appeals court blocked Trump's bid to oust Cook, ensuring continuity in the Fed's decision-making process.
The combination of accommodative monetary policy and these corporate developments in key technology sectors is providing a boost to investor confidence. Markets are riding near historic peaks, suggesting continued faith in the economic outlook.
As always, it's important for investors to stay informed and make decisions based on a comprehensive understanding of the market conditions and individual company performances.
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