Wall Street closed the last session of the week with two major indices, the Dow Jones and the S&P 500, which reached new highs after a speech by Federal Reserve Chairman Jerome Powell eased investor fears over a possible US interest rate hike.
The Dow rose 233 points to close at 35,446.46, hitting a session high. The S / P 500 also climbed to a record high to close at 4509.46, or 0.88% higher. The Nasdaq added 1.23% to close at 15,129.5.
Jerome Powell spoke at the opening of the Kansas City Federal Reserve’s annual symposium in Jackson Hole, Wyoming, where he said that a phased out of the asset purchase program is expected this year after the economy makes “significant progress.” As required by the monetary authorities, in the area of inflation.
Despite this, the Fed chairman stressed that, on the one hand, raising interest rates remains distant and will require “tougher tests” for various aspects of the economy, recalling that the labor market still has a long way to go.
In the chapter on inflation, Powell reiterated that the current rise in the CPI will be temporary, giving a detailed explanation of the reasons that lead him to uphold this point of view, including the lack of transversality of inflationary pressures in various sectors of the economy or the economy. maintaining long-term inflation expectations at 2%.
Markets reacted enthusiastically to the move, and procyclical bonds capitalized on the prospect of maintaining cash support for the recovery. In particular, the energy sector saw significant growth, helped by market expectations of possible disruptions in oil supplies following tropical storm Ida.
The banking sector also rose on Friday’s session, with Bank of America adding 1.02%, Goldman Sachs – 1.69% and Morgan Stanley – 1.45%. Major tech companies also closed in positive territory, rising from 0.69% for Apple to 2.26% for Facebook.
