Market Rally as Fed Cuts Rates Post Trump Reinstatement

U.S. stocks soared following a 25-basis-point interest rate cut by the Federal Reserve, amid investor optimism over Donald Trump's return as president. Despite mixed market performance, the rate cut, anticipated by most, triggered a surge in major indexes, driven by expectations of tax and regulatory changes.

The Federal Reserve's decision to cut interest rates by 25 basis points has driven U.S. stock markets to new highs. Thursday's rally was fueled in part by investor optimism over Donald Trump's return as U.S. president, which has led to expectations of lower corporate taxes and relaxed regulations.

The rate cut, long anticipated by investors, comes amid a job market that has shown signs of easing and inflation inching closer to the Fed's 2% target. All eyes are now on forthcoming commentary from the central bank as traders look for further guidance on monetary policy.

S&P 500 and Nasdaq indices saw notable gains, buoyed by particular strength in communications services. However, the financial sector lagged, with banks slipping after previous high gains. As economic indicators remain strong, the expectation for further rate cuts is tempered, while the impact of potential tariffs under Trump's administration is assessed.

(With inputs from agencies.)