US stocks hit new highs.

The S&P 500 closed at a record high, driven by soaring technology stocks and expectations of a Fed interest rate cut this year.

At the close of trading on January 19, the S&P 500 rose 1.2% to 4,839 points. This is a new high, surpassing the previous record of 4,796 points set at the beginning of 2022.

Technology stocks led the gains, rising 2.4%. AI-related stocks surged. Nvidia added 4.2%, reaching a new high. Meta Platform also hit a record high of $383 per share.

Similarly, the DJIA index rose 1.1%, closing at a new high of 47,863 points.

After a turbulent start to the year, the S&P 500 index has gradually stabilized. To date, it has risen 1.5%. Last year, the increase was 24%, mainly concentrated towards the end of the year. This is due to investor optimism that the US Federal Reserve (Fed) can help the country achieve a soft landing, or control inflation without causing an economic recession.

At its policy meeting last month, the Fed projected three interest rate cuts next year. This was a surprising turning point in the fight against inflation. The agency had also kept interest rates unchanged for the past six months, signaling that it had completed its rate-raising process.

Since the beginning of the month, comments from several Fed officials have dampened investor expectations about a potential March rate hike. Atlanta Fed President Raphael Bostic said on January 18 that he did not believe the Fed could cut interest rates in the first half of this year. A few days earlier, Fed Governor Christopher Waller also said they would not rush to cut rates.

However, on January 19th, Chicago Fed President Austan Goolsbee gave investors renewed hope when he indicated that the central bank should consider cutting interest rates if inflation continues to fall. "If inflation continues to show unexpected, better-than-expected developments, we will reconsider the level of tightening," he told CNBC.

Ha Thu (according to Reuters, CNN)

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