STORY: Wall Street was on fire Thursday, with the S&P 500 index closing at a new all-time high on increased optimism that the Federal Reserve will cut interest rates this year.
The Dow Jones Industrial Average rose more than three-tenths of a percent, the S&P 500 rose 1% and the Nasdaq rose 1.5%.
Fed Chairman Jerome Powell told a Senate committee on his second day of testimony on Capitol Hill that the central bank is almost confident that inflation will fall to its annual 2% target.
Thomas Martin is a senior portfolio manager at GLOBALT Investments.
“So today's sentiment is largely due to Mr. Powell's Congressional testimony in the Senate yesterday and today. And his comments that rate cuts will happen this year are really reassuring. And I think there were questions about his commitment to that.”
Investors flocked to semiconductor stocks, with the Philadelphia Semiconductor Index outperforming the broader market, rising 3.4% to an all-time high. Nvidia, a popular AI chip company, rose 4.5%.
We're also heavy on Nasdaq: Meta Platforms, which is up more than 3%.
In other corporate news, lingerie retailer Victoria's Secret's stock price fell nearly 30% following a weak full-year outlook.
And Kroger stock rose about 10% after the grocer predicted annual sales and profits would beat Wall Street expectations.
The release of the Labor Department's key nonfarm employment report on Friday should provide further clues about the direction of Fed policy.
