U.S. Stock Indexes Surge Amid Federal Reserve's Half-Point Rate Cut

U.S. stock indexes soared following a significant half-point rate cut by the Federal Reserve. The move, anticipated by global markets, aimed to boost risk assets and alleviate concerns about an economic slowdown. Tech stocks led the surge, with major indexes like the Nasdaq and Dow Jones recording significant gains.

U.S. stock indexes surged on Thursday, following in the footsteps of global markets, as the Federal Reserve initiated an eagerly awaited interest rate cut, slashing rates by a substantial half-point. This strategic move boosted risk assets and assuaged fears of an economic slowdown in the world's largest economy.

Mega-cap tech stocks such as Microsoft and Apple spearheaded the rally on Wall Street. Smaller enterprises, which are likely to benefit from reduced operating costs and cheaper debt in a low-rate environment, also saw gains. The Nasdaq Composite jumped 2.39% to close at 17,994.07, while the blue-chip Dow Jones Industrial Average rose 0.97% to 41,903.85. The S&P 500 hit a new intraday high, boosting 1.54% to 5,704.89, and the Russell 2000 small-cap index increased by up to 2%.

The optimistic jobless claims report further buoyed market sentiment, with lower-than-expected claims suggesting that the U.S. might navigate inflation cooling without triggering a recession. Investment strategist Ross Mayfield emphasized that the Fed's guidance for more rate cuts through 2025 should encourage growth in rate-sensitive sectors.

Global market sentiment remained positive, with MSCI's 47-country world stocks index climbing 1.45% to 838.30. In Europe, the STOXX 600 index rose over 1%, and sterling strengthened against the dollar. Meanwhile, gold and oil prices increased due to the expectation of stronger demand in a lower-rate environment.

(With inputs from agencies.)