Mixed Close for Stock Markets after Federal Reserve Decides on Interest Rate Cuts
Before the Juneteenth holiday, the stock markets closed mostly low as investors processed news of interest rate cuts.
Quick overview
- Federal Reserve Chairman Jerome Powell announced that inflation is expected to rise, but the Fed plans to implement two interest rate cuts by the end of 2025.
- The Nasdaq closed slightly higher, while the S&P 500 and Dow Jones experienced minor declines ahead of the Juneteenth holiday.
- KWESST Micro Systems saw a significant stock increase of 94% after securing a contract, while Visa faced a 17% drop due to competitive pressures.
- The stock and bond markets will remain closed for the Juneteenth holiday, reopening on Friday with potential market reactions to the Fed's decisions.
Federal Reserve Chairman Jerome Powell Spoke on Wednesday concerning inflation and interest rate cuts. The Fed decision caused the Nasdaq to close slightly higher while other indices closed low.
Both the S&P 500 and the Dow Jones dropped by the end of Wednesday trading, ahead of the Juneteenth holiday. All stock markets are closed for Thursday, and that gives investors time to mull the Federal Reserve decision.
This is the fourth consecutive meeting by the Federal Reserve where the interest rate has been left unchanged. Chairman Powell said that inflation is expected to increase over the coming months, and yet the Fed still plans to issue two rate cuts before the end of 2025.
The Fluctuating Stock Indices
Nasdaq added 0.13% on Wednesday before trading closed off, with several tech stocks like KWESST Micro Systems Inc. (KWE) doing exceptionally well. That stock gained 94% on Wednesday after the company secured a contract to make laser systems.
Wednesday was a good day for Tesla (TSLA) as that stock gained 1.80% after a rough week. Apple (AAPL) continued its downward streak by ending the day down 0.26%.
The Dow Jones fell 0.10% on Wednesday, with severe losses for Visa (V) as that stock fell 17% as it performs poorly against its competition and is dealing with the aftermath of a new stablecoin bill. There was very little positive news on the Dow Jones index, with Goldman Sachs (GS) leading the gains by increasing 1.70%.
The S&P 500 ended the day almost flat, with a minor loss of 0.03%. Coinbase Global (COIN) saw the most positive change with an increase of 16% as stablecoin legislation has been changed to give the market a boost. Mastercard (MA) saw the biggest losses, with a drop of 5.39% for the day as most credit card companies underperformed this week.
The stock and bond markets are both closed through Thursday June 19th to commemorate the Juneteenth holiday but will open once more on Friday morning. The promise of two more cuts coming this year from the Federal Reserve could be enough to lift the stock market slightly once Friday trading begins.
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