Wednesday, 5 June 2019

US stocks surge as Fed officials hint at rate cut

Markets were mostly higher on Tuesday.

The S&P 500 surged 2.1 percent and the STOXX Europe 600 rose 0.6 percent but the Nikkei 225 finished flat.

US stocks were boosted by Federal Reserve Chairman Jerome Powell's comment at a monetary policy conference that the central bank would “act as appropriate” to sustain the economic expansion in the face of trade disputes.

Powell’s remarks followed St. Louis Fed President James Bullard's on Monday that rate cuts “may be warranted soon” amid the trade disputes.

But as far as rate cuts are concerned, the Reserve Bank of Australia has gotten a head start. It lowered its benchmark interest rate by a quarter of a percentage point to 1.25 percent, its first rate cut in nearly three years.

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