U.S. stocks saw a significant surge on Wednesday afternoon following the conclusion of the Federal Reserve’s two-day policy meeting. The Fed decided to keep interest rates unchanged but indicated that two rate cuts were still anticipated throughout 2025. The S&P 500 rose by 1.1%, gaining 60.63 points to close at 5,675.29, while the Dow increased by 0.9%, adding 383.32 points to reach 41,964.63. The Nasdaq, known for its tech-heavy focus, jumped by 1.4%, rising by 246.67 points to close at 17,750.79. Concurrently, the benchmark 10-year Treasury note saw a slight decline of about 3 basis points, ending the day near 4.26%.
This marked the second consecutive day of gains for Wall Street, although stocks remained significantly lower compared to the beginning of the year. President Donald Trump’s announcements of new or heightened tariffs globally, followed by subsequent reversals, along with efforts to reduce the federal workforce and alter spending patterns by the administration and Tesla Chairman Elon Musk, have impacted consumer and investor confidence negatively.
Federal Reserve Chair Jerome Powell is set to address the Senate Banking, Housing, and Urban Affairs Committee on February 11, 2025. Powell will conduct a press conference following the conclusion of the Fed’s policy meeting on Wednesday. Consumer concerns regarding job security have reached levels typically observed during recessions, as highlighted by Apollo Global Management Chief Economist Torsten Slok. The latest data indicates a growing pessimism among consumers about business conditions, signaling a rapid decline in consumer sentiment.
While Fed policymakers acknowledged the heightened economic uncertainty, they maintained their expectation of implementing two interest-rate cuts in 2025. Trump and his cabinet have warned about the possibility of an economic downturn, describing it as a necessary “detox period” for adjusting to new policies.
In other market news, NVIDIA shares saw a nearly 2% increase, Boeing shares rose by almost 7%, and General Mills stock experienced a loss of over 2% after reporting expected sales decline. HealthEquity, Inc. shares dropped by more than 17% following disappointing earnings.
