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U.S. equities rebounded Friday after New York Federal Reserve President John Williams suggested the central bank could cut rates again in December.
The Dow Jones Industrials index leaped 446.44 points, or 1%, to 46,198.70.
The S&P 500 added 48.86 points to 6,587.24
The NASDAQ popped 117.22points to 22,105.27.
Stocks that could benefit the most from lower rates boosting consumer spending helped lead the market comeback, including Home Depot, Starbucks and McDonald’s. Investors hope easier monetary policy can revive a sluggish economy and justify historically high tech-stock valuations.
Even with Friday’s moves, however, the broad market S&P 500 is still down around 2% week to date, as is the 30-stock Dow. The NASDAQ has shed about 3%.
The comments by a notable Fed member like Williams broke the equity market out of its artificial intelligence-stock slump and raised traders’ bets that the central bank would in fact cut next month for the third time this year.
Fed funds futures traders are currently pricing in a more than 70% chance of a quarter percentage point cut, a spike from the 39.1% likelihood priced in the day before
Prices for the 10-year Treasury skidded, pushing yields up to 4.08% from Thursday’s 4.10%. Treasury prices and yields move in opposite directions.
Oil prices moved downward $1.22 to $57.78 U.S. a barrel.
Gold prices jumped $11.30 to $4,071.30 U.S. an ounce.
