Wall Street Slightly Rises, Focus on Fed Minutes

On Wall Street, stock prices rose on Wednesday as investors became convinced that a reduction in interest rates is forthcoming in September following the release of the minutes from the last meeting of the leaders of the U.S. central bank.

The Dow Jones index strengthened by 0.14 percent, to 40,890 points, while S&P 500 rose by 0.42 percent, to 5,620 points, and the Nasdaq index by 0.57 percent, to 17,918 points.

Yesterday, the minutes from the Fed’s July meeting were released, where it was decided that interest rates would remain unchanged. However, many expressed a willingness to reduce rates at the next meeting if inflation continues to weaken. As a result, investor confidence has solidified that the Fed will lower interest rates at the September meeting for the first time after years of tightening monetary policy.

The Fed is expected to cut rates by 0.25 percentage points. However, some believe a sharper reduction of 0.5 percentage points is possible as revised data for the past year showed that the U.S. labor market is weaker than previously thought.

Investors hope that Fed Chairman Jerome Powell will clarify the situation regarding interest rates, inflation, and the labor market in his speech on Friday at the traditional gathering of central bankers in Jackson Hole.

European stock markets also saw price increases yesterday. The London FTSE index strengthened by 0.12 percent, to 8,283 points, while the Frankfurt DAX rose by 0.50 percent, to 18,448 points, and the Paris CAC by 0.52 percent, to 7,524 points.

On most Asian stock exchanges on Thursday, stock prices also rose. The MSCI index of Asia-Pacific stocks, excluding Japan, was up 0.2 percent at 7:00 AM. Meanwhile, the Nikkei index on the Tokyo Stock Exchange strengthened by 0.2 percent, while stock prices in Australia and Hong Kong rose between 0.2 and 0.4 percent. In South Korea and Shanghai, they slightly fell.

In the currency markets, the value of the dollar against a basket of currencies has plunged to a new low for this year. The dollar index, which shows the value of the U.S. dollar against the other six major world currencies, is around 101.14 points this morning, while it was 101.34 points at this time yesterday. At one point, this index even dipped below the level of 101 points.

At the same time, the exchange rate of the dollar against the Japanese currency rose from yesterday’s 144.95 to 145.10 yen. However, the U.S. currency weakened against the European one, as the price of the euro reached 1.1155 dollars, a new high for this year, while it was 1.1130 dollars at this time yesterday.

Oil prices, on the other hand, have slightly fallen. The price of a barrel on the London market slipped by 0.07 percent, to 76.05 dollars, while on the U.S. market, a barrel decreased by 0.19 percent, to 71.20 dollars.