US stocks close higher as chances of more aggressive Fed rate cut rise

NEW YORK, Sept. 13 (Xinhua) — U.S. stocks ended Friday’s session higher as Wall Street’s expectations of a significant interest rate cut by the Federal Reserve rose sharply overnight, fueling positive market sentiment.

The Dow Jones Industrial Average was up 297.01 points, or 0.72 percent, to 41,393.78. The S&P 500 index was up 30.26 points, or 0.54 percent, to 5,626.02. The Nasdaq Composite index was up 114.30 points, or 0.65 percent, to 17,683.98.

All 11 major S&P 500 sectors ended in the green, with utilities and communication services leading the gains, adding 1.41% and 1.02%, respectively. Healthcare was the weakest gainer, up 0.19%.

The likelihood has increased that the Federal Reserve will begin its rate-cutting cycle next week, with a 0.5 percentage point cut.

Recent trades in interest-rate futures suggest a 49 percent chance the Fed will cut rates to a range of 4.75 percent to 5 percent, according to the CME FedWatch tool. That’s a significant increase from a 28 percent chance on Thursday and just 14 percent on Wednesday, reflecting a shift in market expectations.

Adobe shares fell in afternoon trading after the company forecast that its artificial intelligence initiatives would deliver little immediate benefit.

On the other hand, Oracle shares continued to rise, supported by optimistic forecasts predicting revenue growth over the next five years driven by strong demand for cloud services.

Meanwhile, Boeing shares fell as factory workers went on strike, halting production at the company’s largest manufacturing facility in Seattle.