Wednesday's big rate cut by the Fed had a delayed-jubilation effect on the markets Thursday. The Dow, for example, eclipsed 42,000 for the first time—and closed there to boot. The benchmark S&P 500, meanwhile, closed above 5,700 for the first time, per CNBC.
- The Dow rose 522 points, or 1.2%, to 42,025.
- The S&P 500 rose 95 points, or 1.7%, to 5,713.
- The tech-focused Nasdaq rose 440 points, or 2.5%, to 18,013.
- The gains spread to the world of cryptocurrency, where bitcoin rose more than 4% and eclipsed $63,000.
The rally was widespread, and the company behind Olive Garden—Darden Restaurants— helped lead the way with a jump of 7.8%, per the AP. It said sales trends have been improving since a sharp step down in July, and it announced a delivery partnership with Uber. Nvidia, meanwhile, barreled 4.6% higher and was once again the strongest force lifting the S&P 500. Lower interest rates weaken criticism by a bit that its shares and those of other influential Big Tech companies look too expensive following the frenzy around artificial-intelligence technology .
Wall Street's initial reaction to Wednesday's cut was a yawn, after markets had already run up for months on expectations for coming reductions to rates. Stocks ended up edging lower after swinging a few times. "Yet we come in today and have a reversal of the reversal," said Jonathan Krinsky, chief market technician at BTIG. He said he did not anticipate such a big jump for stocks on Thursday. Some analysts said the market could be relieved that the Fed's Powell was able to thread the needle in his press conference and suggest the deeper-than-usual cut was just a "recalibration" of policy and not an urgent move it had to take to prevent a recession.
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