Biggest Rally in Eight Months: Dow Jumps 600 Points After Fed Hints at Fewer Interest Rate Hikes
- The Dow Jones Industrialsurged more than 600 points
yesterday, biggest rally since March.
That's roughly 2.5%.
At the same time, the S&P 500 jumped 2.3%
and the NASDAQ, nearly 3%
The rally is tied to comments made by
Federal Reserve Chairman Jerome Powell,
who hinted at fewer ratehikes in the months ahead.
They'd been fears the Fed'splanned rates increases
could slow economic growth.
- Interest rates are stilllow by historical standards
and they remain just belowthe range of estimates
of that level that wouldbe neutral for the economy,
that is neither speedingup nor slowing down growth.
- [Jenna Voiceover] Achange in tone for Powell
who just two months agosuggested more rate increases.
Those comments drew sharpcriticism from President Trump.
Phil Kerpen tells CBN News,Powell's latest announcement
eases fears the economywill weaken drastically.
- I think that part of that,
was the expectation thatthe Reserve was going to be
hitting the breaks prettyhard on the economy
by raising interest rates.
That, now appears less likely.
- [Jenna Voiceover] Thetrade friction between the
US and China, there's anotherbig concern for investors.
Trump says he's willingto go forward with tariffs
against China, but there arehopes he and President Xi
can come to an agreementthis week at the G20 summit.
- We do have an awfullot of leverage right now
to get a better deal and tosort of call off the tariffs
which I think is a very big positive,
both for the stock marketand for the economy,
if they're able to do that.
- [Jenna Voiceover] Withthe US economy growing
at 3.5% in the third quarter,
most experts predict a slowdown in the fourth quarter,
but even with General Motorsannouncing it's laying off
thousands of workers,economist Stephen Moore says
it's not as bad as some may think.
- Since Donald Trump waselected, we've created nearly
one million manufacturingconstruction jobs.
So we're not loosingthese blue-collar jobs,
we're gaining them, sofor every plant like this,
that is closing, we'reseeing 10 or 20 new plants
being opened up all over the country.
- The US economy is soaring,the big question now
is will the Fed keepthose interest rates down.
In Washington, Jenna Browder, CBN News.