Stock Market Update: Wall Street Slips, but Hopes for AI and Rate Cuts Keep Indexes Near Records

The stock market in the United States experienced a mixed day on Thursday, with most stocks slipping slightly. However, hopes for future interest rate cuts and the ongoing excitement around artificial intelligence technology pushed indexes to new records.

The S&P 500 reached a new all-time high, increasing by 0.2% from the previous day. The Nasdaq composite also climbed to a new record, rising by 0.3%, driven by gains in technology stocks. On the other hand, the Dow Jones Industrial Average fell by 0.2%.

The bond market saw Treasury yields easing as the belief grew that inflation was slowing down enough to prompt the Federal Reserve to cut interest rates later in the year. Recent updates on inflation showed that prices at the wholesale level were not as high as expected, with prices actually dropping from April to May.

Federal Reserve Chair Jerome Powell expressed optimism about the lower-than-expected inflation at the consumer level, indicating that more data was needed before considering a rate cut. The hope is that slowing growth in the job market and economy will alleviate inflation pressures without causing a recession.

Companies closely tied to economic strength, such as oil-and-gas producers and industrial companies, lagged in the market following the reports. However, companies involved in artificial intelligence technology saw significant gains. Broadcom, a semiconductor company, reported stronger profits than expected, leading to a 12.3% jump in its stock price.

Tesla also saw a 2.9% increase in its stock price after CEO Elon Musk hinted at shareholder approval for his pay package. The overall market saw the S&P 500 rise, while the Dow and Nasdaq experienced slight fluctuations.

Looking ahead, most Fed officials are anticipating one or two interest rate cuts this year, with traders hopeful for a September start. While the economy is expected to slow down, the hope is to avoid a recession. However, uncertainties around upcoming elections and global events could impact market stability.

In Europe, markets were affected by recent elections, with support for far-right parties rising in countries like France and Germany. Asian markets also saw fluctuations, with Japan’s Nikkei 225 slipping ahead of an interest rate decision by the central bank.

Overall, the stock market continues to be influenced by a mix of economic data, technological advancements, and global events, making for an interesting and dynamic trading environment.