Stocks Surge on Suggestion of New Fed Strategy

Stocks had a strong day on Friday, boosted in part by a report suggesting the Fed might begin cooling down its rate increases before the end of the year. The Dow surged 748 points, or 2.4%, to 31,082; the S&P 500 rose 86 points, or 2.3%, to 3,752; and the Nasdaq rose 244 points, or 2.3%, to 10,859. Technology and health care companies has some of the strongest gains, per the AP. Oracle rose 4.6% and Pfizer rose 4.7%. Social media companies were broadly lower after Snapchat’s parent company issued a weak forecast, and on reports that Elon Musk plans to slash about three-quarters of the payroll at Twitter after he buys the company. Snap slumped 30% and Twitter shed 4.7%.

The Fed, meanwhile, is expected to raise interest rates another three-quarters of a percentage point at its meeting in November. But the Wall Street Journal reported that some Fed officials are signaling more caution and suggesting a slowdown in rate increases after that, perhaps in December, to see how the fight against inflation is going. Investors have shifted their focus, for now, to the latest round of corporate earnings as they look for more clues about how hot inflation and rising interest rates are shaping the economy. Reports from airlines, banks, railroad operators, and others have so far provided mixed financial results and forecasts.

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