The Dow Jones Industrial Average increased by 447 points, ie 1%. S & P 500 increased by 1.1%, while Nasdaq Composite added 1.3%. And S & P and Nasdaq rose to new daily maxims.
New information on inflation on Tuesday was published on Tuesday investors who feared that the broad Customs policy of the President Donald Trump could increase prices in the American economy.
The consumer price index increased by 2.7% on an annual basis in July, while Dow Jones’ estimation envisions growth of 2.8%. The so-called underlying CPI, which excludes unstable food and energy prices, increased by 3.1% on an annual basis – slightly more than expected 3%.
The expectations of lower interest rates have risen after the report. Traders now estimate almost 91% chances of reducing interest rates, according to the trading data from the CME Fedwatch Tool. It is an increase compared to 85% chance before publication of data. The traders also increased their bets on the reduction in interest rates in October and December, the SEEbiz transmits.
“It looks like the stock market now will have a little luck,” Tom Hainlin said, the National Investment Strategist in the US Bank Asset Management Group. “More and more people expect a reduction in interest rates in September. Thus, interest rates are on the descendant side, and earnings on ascending – it is a pretty good environment for a wide stock market.”
Societies with small market capitalization, which are considered large users of lower short term interest rates, and Russell 2000 increased almost triple more than the winner of the Stable Circle Internet Group after reporting a 53% annual increase in revenue in the second quarter.
