Dow Jones jumps 500 points as Fed chair Powell comments about economy
The Dow Jones jumps after comments by Fed chair Jerome Powell and possible resolutions to tariff disputes.
The Dow Jones is surging after US Federal Reserve chair, Jerome Powell, said that the central bank could take action to help the US economy.
Powell’s comments boost the Dow Jones
‘We are closely monitoring the implications of these developments for the US economic outlook and, as always, we will act as appropriate to sustain the expansion, with a strong labour market and inflation near our symmetric 2% objective,’ said Powell.
Powell hasn’t explicitly said the Fed will change course on its decision to leave interest rates unchanged. However, Keith Lerner, strategist at SunTrust Private Wealth, believes that Wall Street is hoping for an interest rate cut.
‘The market wanted to hear from Powell. When Powell says, "We are watching the market" — whether it’s right or wrong — the market starts believing in a Powell put,’ said Lerner.
Dow Jones rises after possible easing of trade tensions
Though the Fed is concerned about trade conflicts, there may be an easing to the US-China tariff war. A spokesperson for the Chinese Commerce Ministry said that the conflict could end through trade talks, according to a Google translation.
‘The Chinese side always believes that the differences and frictions between the two sides in the economic and trade field will ultimately need to be resolved through dialogue and consultation,’ said the spokesperson.
In addition to the news about China, there may be a resolution to the US-Mexico trade dispute. Mexico’s Deputy Foreign Minister, Jesus Seade, and US Trade Representative, Robert Lighthizer, met to discuss the trade impasse between the two nations, according to a Seade staff member.
Investors are hopeful that Powell’s comments and possible trade negotiations will help the Dow Jones continue to rally.
IGA, may distribute information/research produced by its respective foreign affiliates within the IG Group of companies pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the research is distributed in Singapore to a person who is not an Accredited Investor, Expert Investor or an Institutional Investor, IGA accepts legal responsibility for the contents of the report to such persons only to the extent required by law. Singapore recipients should contact IGA at 6390 5118 for matters arising from, or in connection with the information distributed.
The information/research herein is prepared by IG Asia Pte Ltd (IGA) and its foreign affiliated companies (collectively known as the IG Group) and is intended for general circulation only. It does not take into account the specific investment objectives, financial situation, or particular needs of any particular person. You should take into account your specific investment objectives, financial situation, and particular needs before making a commitment to trade, including seeking advice from an independent financial adviser regarding the suitability of the investment, under a separate engagement, as you deem fit.
Please see important Research Disclaimer.
Take a position on indices
Deal on the world’s major stock indices today.
- Trade the lowest Wall Street spreads on the market
- 1-point spread on the FTSE 100 and Germany 30
- The only provider to offer 24-hour pricing
Live prices on most popular markets
Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 15 mins.