Dow, S&P closes at record levels as Fed rate cut fuels US stocks

By Ovunc Kutlu

ISTANBUL (AA) - The Dow closed above a record 42,000, and the S&P 500 climbed over 5,700 points for the first time Thursday as the Federal Reserve's jumbo interest rate cut fueled US stocks.

The blue-chip Dow rose 522 points, or 1.26%, to finish the session at 42,025. The S&P 500 jumped 95 points, or 1.7% to 5,713.

The Nasdaq Composite, meanwhile, soared 440 points, or 2.51%, to end the day at almost 18,014.

The Fed lowered the interest rate Wednesday by 50 basis points to a range between 4.75% - 5.0%, starting its monetary easing aggressively. The move marked the first cut by the central bank since the beginning of the coronavirus pandemic.

Except for the emergency rate cuts during the start of the pandemic, the last time the Fed delivered a jumbo rate cut of 50 basis points was during the global financial crisis in 2008.

The VIX volatility index, referred to as the "fear index," fell 10.4% to 16.33. The 10-year US Treasury yield added 0.86% to 3.719%.

The US dollar index increased 0.04% to 100.63, while the euro rose 0.4% against the dollar, trading at $1.1162.

Precious metals were in positive territory. Gold added 1.1% to $2,587 per ounce and silver rose 2.4% to $30.80.

Oil prices rose around 1.6%, with global benchmark Brent crude at $74.81 per barrel and US benchmark West Texas Intermediate at $71.10.