US Markets Extend Rally for Third Straight Day
US stocks closed higher for the third consecutive day on Tuesday, May 7th, 2024, as investor optimism surrounding potential interest rate cuts from the Federal Reserve continued to fuel the market.
The Dow Jones Industrial Average rose by a moderate 0.4%, marking its fourth straight day of gains. The broader S&P 500 index climbed 1.0%, while the tech-heavy Nasdaq Composite added 1.2%.
This upward trend follows Friday’s release of weaker-than-expected jobs data, which eased concerns about inflation and its potential impact on interest rates. Investors interpreted this as a signal that the Fed might be more inclined to cut rates later in the year, stimulating economic growth and boosting corporate profits.
Several individual stocks also contributed to the positive market sentiment. Amgen (AMGN) shares skyrocketed over 11% after promising news regarding a new drug in development. MercadoLibre (MELI), a prominent e-commerce company in Latin America, surged over 8% on the back of a strong earnings report.
However, not all companies saw gains. Palantir (PLTR) stock dipped by 7% after the data analytics firm provided lower-than-expected revenue guidance for the upcoming quarter.
Analysts believe that the earnings season, nearing its peak, will continue to be a major driver of market movements. Investors will be closely watching the reports of key companies, particularly those scheduled to report this week, such as Disney (DIS) and Uber (UBER).
Looking ahead, the market’s direction will likely hinge on developments concerning the Federal Reserve’s monetary policy decisions. Speeches by Fed officials scheduled for this week will be closely monitored to gauge their stance on interest rates. Additionally, global events, such as the ongoing peace talks between Israel and Gaza, could also impact investor sentiment.
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