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The Dow Jones Industrial Average hit its first record closing high since January 2022, and the S&P 500 and Nasdaq rallied more than 1% each on Wednesday after the Federal Reserve signaled that its interest rate-hiking policy is at an end and that it sees lower borrowing costs in 2024.

In its policystatement, the Fed also left interest rates steady, as expected, and a near-unanimous 17 of 19 Fed officials projected that the policy rate will be lower by the end of 2024.

Indexes were flat ahead of the announcement and quickly gained ground after the news.

Stockssharply extended gains as Fed ChairJerome Powellsaid during a press conference that the Fed is “not likely” to hike further and that the Fed is “very focused on not making the mistake of keeping rates too high for too long.”

The Fed since March 2022 has raised its policy rate by 525 basis points in an effort to curb inflation.

“The statement is telling us that the Fed is seeing what the markets have already started to discount, that you’re going to have inflation back to normal without a recession,” said Tom Martin, senior portfolio manager at Globalt Investments in Atlanta.

“We kind of hoped it was going to be this, but we didn’t really think it was.”

The blue-chip index’sfirst all-time highin nearly two years confirmed that it has been in a bull market since tumbling more than 20% through its closing low in September 2022, according to a common definition.

The day’s rally was broad-based with all major S&P 500 sectors ending higher. The rate-sensitive S&P 500 real estateand utilitiessectors rose more than 3% each, leading sector gains. The small-cap Russell 2000 indexshot up 3.5%.

The Dow Jones Industrial Averagesurged 512.30 points, or 1.4%, to 37,090.24, while the Nasdaq and S&P 500each rose 1.4%.

The S&P 500 and Nasdaq hit fresh closing highs for the year. The S&P 500 is now up 22.6% for the year to date, while the Nasdaq is up 40.7% in that period and the Dow is up 11.9%.

Stocks have been rising for weeks on the view that the Fed is likely done hiking rates and will shift to rate cuts next year.

Following the Fed statement, interest rate futures raised the odds of a May rate cut to 90% versus 80% just before the announcement, according to LSEG’sFedwatch.

Earlier in the day,data showed producer prices were unexpectedly unchanged in November amid cheaper energy goods. In a report on Tuesday, US consumer prices unexpectedly rose in November as a decline in the cost of gasoline was more than offset by increases in rents.

Bucking the day’s trend, shares of Pfizerdropped 6.7% after the drugmaker forecast 2024 revenue below Wall Street’s expectations.

Volume on US exchanges was 14.35 billion shares, compared with the 11.04 billion average for the full session over the last 20 trading days.

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Ukraine war: Zelenskyy warns partners not to let Putin ‘deceive’ them on ceasefire

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Ukraine war: Zelenskyy warns partners not to let Putin 'deceive' them on ceasefire

Volodymyr Zelenskyy has called on Ukraine’s partners to make sure Russia doesn’t “deceive” them over a ceasefire.

After breakthrough talks between Ukrainian and US officials in Saudi Arabia, Kyiv said it was ready to accept a proposed 30-day ceasefire with Russia.

But his nightly address on Wednesday evening, a day after the Jeddah summit, President Zelenskyy said, “we must move toward peace” – but issued a warning to allies.

“The key factor is our partners’ ability to ensure Russia’s readiness not to deceive but to genuinely end the war,” the Ukrainian leader said. “Because right now, Russian strikes have not stopped.”

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From Tuesday: Ukraine backs ceasefire plan

‘Calling Moscow’s bluff’: Sky News correspondents’ views as Ukraine accepts ceasefire deal
Who is the real estate mogul tasked with brokering peace in Ukraine?

The focus has now switched to Vladimir Putin’s response to the proposed ceasefire. President Trump said the US had received “some positive messages” adding: “We have people going to Russia right now”.

However, he warned Moscow: “In a financial sense, yeah we could do things very bad for Russia, would be devastating for Russia.”

More on Russia

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Will Russia go for ceasefire deal?

European defence ministers, meeting in Paris, said now was the time for Moscow to show it was serious about ending the war.

UK Defence Secretary John Healey was among those attending, and had a direct message for Russia’s president: “I say to president Putin, over to you, you want to talk, prove it.”

Mr Healey called on Russia to accept the ceasefire and end the war, adding, “the pressure is now on Putin”.

For his part, President Putin has been playing to his domestic audience with a visit to Kursk, where Russian troops finally seem to be gaining the upper hand against Ukrainian forces who seized territory in the Russian region last year.

The Russian line is approaching Sumy from Kursk Oblast
Image:
The Russian line is approaching Sumy from Kursk Oblast

Dressed in camouflage, the Russian president called for his forces to defeat the enemy and completely liberate Kursk, in remarks reported by the Interfax news agency.

He also said enemy troops captured in the region will be treated as terrorists, as Russia’s chief of the general staff told Mr Putin that Ukrainian forces in the region are surrounded.

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Ukraine war: Zelenskyy warns partners not to let Putin ‘deceive’ them on ceasefire

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Ukraine war: Zelenskyy warns partners not to let Putin 'deceive' them on ceasefire

Volodymyr Zelenskyy has called on Ukraine’s partners to make sure Russia doesn’t “deceive” them over a ceasefire.

After breakthrough talks between Ukrainian and US officials in Saudi Arabia, Kyiv said it was ready to accept a proposed 30-day ceasefire with Russia.

But his nightly address on Wednesday evening, a day after the Jeddah summit, President Zelenskyy said, “we must move toward peace” – but issued a warning to allies.

“The key factor is our partners’ ability to ensure Russia’s readiness not to deceive but to genuinely end the war,” the Ukrainian leader said. “Because right now, Russian strikes have not stopped.”

Please use Chrome browser for a more accessible video player

From Tuesday: Ukraine backs ceasefire plan

‘Calling Moscow’s bluff’: Sky News correspondents’ views as Ukraine accepts ceasefire deal
Who is the real estate mogul tasked with brokering peace in Ukraine?

The focus has now switched to Vladimir Putin’s response to the proposed ceasefire. President Trump said the US had received “some positive messages” adding: “We have people going to Russia right now”.

However, he warned Moscow: “In a financial sense, yeah we could do things very bad for Russia, would be devastating for Russia.”

More on Russia

Please use Chrome browser for a more accessible video player

Will Russia go for ceasefire deal?

European defence ministers, meeting in Paris, said now was the time for Moscow to show it was serious about ending the war.

UK Defence Secretary John Healey was among those attending, and had a direct message for Russia’s president: “I say to president Putin, over to you, you want to talk, prove it.”

Mr Healey called on Russia to accept the ceasefire and end the war, adding, “the pressure is now on Putin”.

For his part, President Putin has been playing to his domestic audience with a visit to Kursk, where Russian troops finally seem to be gaining the upper hand against Ukrainian forces who seized territory in the Russian region last year.

The Russian line is approaching Sumy from Kursk Oblast
Image:
The Russian line is approaching Sumy from Kursk Oblast

Dressed in camouflage, the Russian president called for his forces to defeat the enemy and completely liberate Kursk, in remarks reported by the Interfax news agency.

He also said enemy troops captured in the region will be treated as terrorists, as Russia’s chief of the general staff told Mr Putin that Ukrainian forces in the region are surrounded.

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Technology

Binance secures ‘largest investment ever’ in crypto as Abu Dhabi’s MGX pledges $2 billion

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Binance secures ‘largest investment ever’ in crypto as Abu Dhabi’s MGX pledges  billion

The Binance logo is displayed on a screen in San Anselmo, California, June 6, 2023.

Justin Sullivan | Getty Images

Emirati state-owned investment firm MGX announced a $2 billion investment into Binance, in what marks the cryptocurrency exchange’s first institutional investment and the “single largest investment” ever paird in crypto.

In a joint press release, the firms said the minority stake would be paid for in stablecoins, making it the “largest investment ever” paid in cryptocurrency. Stablecoins are a type of digital asset designed to hold a constant value, typically with a peg to a fiat currency. 

Abu Dhabi launched the MGX investment firm last year with a focus on AI technology. In September, MGX partnered with the likes of BlackRock and Microsoft to launch a more than $30 billion AI fund, but it had yet to invest in the cryptocurrency industry and blockchain sectors. 

“MGX’s investment in Binance reflects our commitment to advancing blockchain’s transformative potential for digital finance,” Ahmed Yahia, managing director and CEO at MGX, said in a statement.

The press release added that “by partnering with the leading industry player, MGX aims to enable innovation at the intersection of AI, blockchain technology and finance.”

Binance and MGX did not immediately comment on the size of the stake or what stablecoin would be used for the payment. Binance has not responded to an inquiry on whether the deal had been completed.

As part of the UAE’s broader ambitions to become a global technology leader, it has been growing into a regional crypto hub

Binance, the largest cryptocurrency exchange in the world, has grown its Middle East footprint as it faced regulatory hurdles and enforcement measures in other jurisdictions in recent years, 

According to the press release, Binance employs approximately 1,000 of its roughly 5,000 global workforce in the UAE. It adds that it now boasts over 260 million registered users and has surpassed $100 trillion in cumulative trading volume. 

Binance CEO Richard Teng is scheduled to take part in a panel session at CNBC’s CONVERGE LIVE in Singapore at 2:40 p.m. local time (2:40 a.m. ET) on Thursday.

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