Stock Markets Soar as Fed Stays Put Despite Pressure from Trump
Stock markets in the U.S. surge following the Federal Reserve's decision.
In a move that pleases Wall Street, the Fed remains resolute and leaves key interest rates unchanged, defying pressure from President Donald Trump. This decision sends the US indices soaring. However, Weight Watchers faces a steep drop following a bankruptcy filing.
The Dow Jones Index, a collection of blue-chip stocks, closes 0.7% higher at a impressive 41,113 points, buoyed by the Fed's decision. The Nasdaq, known for its tech-heavy profile, advances 0.3%, reaching 17,738 points, while the broad-based S&P 500 surges 0.4%, settling at 5,631 points.
Investors were initially coy, given Trump's statement about not withdrawing tariffs against China at a steep 145%. However, the anticipated decision from the Fed materialized as expected. Despite the potential risks of increased unemployment and inflation, the Fed remains unfazed, vowing to wait and see how the trade conflict unfolds before considering any potential interest rate cuts — a demand repeatedly voiced by Trump.
Fed Chairman Jerome Powell reiterates that the Fed's work is not swayed by White House interruptions, dismissing any influence these may have. Analysts agree that the Fed's explanation is a calculated message to the White House, signaling the increased risks of higher unemployment and inflation.
High-level US-China trade talks are set to take place in Switzerland this week, providing investors with something to look forward to. However, a trade agreement is unlikely, according to market experts.
Elsewhere in the market, shares of WW International plummet 43% after filing for bankruptcy. The diet company, formerly known as Weight Watchers, grapples with the news. Apple's recent plans, reportedly involving an AI-powered Safari browser, have caused a 7.3% drop in Alphabet's stock. Meanwhile, Coty's shares dip 11.6% following a profit warning. On the bright side, Walt Disney's shares rise 10.8%, buoyed by strong revenue and profits in the first quarter, fueled by surging subscriber numbers for Disney+ and Hulu streaming services. For extensive coverage of today's stock market activity, click here.
Sources: ntv.de, ino/rts
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- The Fed's decision to maintain key interest rates, despite pressure from President Trump, pleases Wall Street and contributes to a 0.7% increase in the Dow Jones Index, closing at an impressive 41,113 points.
- Amidst potential risks of increased unemployment and inflation, the Fed refrains from considering any interest rate cuts, signaling this decision to the White House through a calculated message. This stance could potentially impact employment policies within various sectors, including the technology, entertainment, and finance industries.
- As the US-China trade talks approach, the market remains uncertain due to the low probability of a trade agreement. This situation could potentially influence the adoption of community policies, especially those relating to employment and business investments.
