Nvidia Surge Powers Nasdaq to Record High as Fed Minutes Signal Rate Cuts
Nvidia briefly crossed the $4 trillion market valuation mark on Wednesday and closed at $3.97 trillion, up 1.8%. This surge helped push the Nasdaq to another all-time high. Stocks of top technology companies also climbed subsequently.
Microsoft shares climbed 1.4%, and Amazon added 1.5%. The S&P 500 gained 0.61%, while the Dow added 0.49%. Eight of the 11 sectors in the S.&P. 500 rose, led by utilities and tech.
Wall Street indexes have steadied after tumbling earlier in the week on trade fears, with investors appearing to grow accustomed to the aggressive but frequently tactical tariff threats of President Trump. Still, with the new deadline of August 1, many on Wall Street are holding out hope that continued negotiation will offer a way out of a full-blown trade war.
Fed Minutes Raise Hopes for Rate Cut
Minutes of the Federal Reserve’s mid-June meeting indicate most officials believe cuts in interest rates will be warranted later this year while noting recent inflation due to Trump’s tariffs is probably temporary. While a July rate cut is not guaranteed, markets interpreted the Fed’s tone as a signal that lower rates are on the horizon. Analysts emphasized that the strong jobs data and a resilient labor market continue to be key variables.
The Trump Tariff Focus
Markets largely ignored President Trump’s announcement of new tariffs. On Tuesday, he proposed a 50% levy on copper and indicated that new tariffs would soon be imposed on semiconductors and pharmaceuticals. The next day the Trump administration sent tariff letters to seven countries, with rates as high as 30%. So far, only Britain and Vietnam have finalized trade deals with the United States, though the European Union is expected to reach a framework agreement soon.
Investors Shrug Off Trade Tensions
Investors continue to shrug off trade tensions.Markets are growing increasingly desensitized to tariff headlines, analysts said, as economic data continues to be strong. The recent scaling back of rate hike expectations and the strength in megacap stocks are also contributing to stable sentiment.
Other Market Highlights
AES Corp jumped 19.8% on news it may investigate selling. Boeing climbed 3.7% on strong aircraft delivery data. UnitedHealth slid 1.6% as the DOJ investigated it for its Medicare billing practices. On the NYSE, by more than 2-to-1, advancers outnumbered decliners, with 18.10 billion shares changing hands.
