Wall Street today: Dow rebounds 200 points after US Fed’s hawkish cut, set to snap 10-day decline; Accenture up 6.5% | Stock Market News

Wall Street Today: Wall Street’s main indexes rebounded to gain some ground on Thursday, December 19, a day after the US Federal Reserve’s projections of fewer-than-expected interest rate cuts and higher inflation in 2025 spooked investors and pummeled US stocks. The stock market indices logged one of the worst Fed days on Wednesday, with the Dow Jones index crashing over 1,110 points to report its longest losing streak since 1974.

On Wednesday, the US Fed announced in its policy verdict that it expects to make just two 25 basis point interest rate cuts in 2025, half a percentage point less than its September forecast. It also raised inflation expectations for the first year of the new Donald Trump administration, sending the three main US stock indexes to their sharpest daily declines since August.

Also Read: US Fed rate cut fuel running out: What it means for the Indian stock market and your investment strategy

S&P 500, Nasdaq, Dow Jones rebound after sell-off

Traders now see just one quarter-point rate reduction by mid-2025 and see less than two cuts in total by the end of the year, compared with last week’s expectations of three rate cuts. The S&P 500 rose 0.4 per cent in morning trading, a day after tumbling 2.9 per cent when the US Federal Reserve said it may deliver fewer cuts to interest rates next year than earlier thought. 

The Dow Jones Industrial Average rose 193.52 points, or 0.46 per cent, to 42,521.17, the S&P 500 rose 27.73 points, or 0.47 per cent, to 5,899.89 and the Nasdaq Composite rose 108.91 points, or 0.55 per cent, to 19,501.60.

Also Read: Accenture Q1 Results: IT major beats quarterly revenue estimates on strong genAI service demand

Wednesday’s drop just drained some of the enthusiasm out of the market, which critics had already warned was overly buoyant and would need everything to go correctly to justify its high prices. Wall Street prefers lower interest rates because they boost the economy and goose investment prices, but they can also fuel inflation.

Accenture’s share price rose by 6.5 per cent after the consulting company topped analysts’ expectations for profit in the latest quarter. The IT major’s CEO, Julie Sweet, said the company saw strong growth worldwide and also raised its revenue forecast for this fiscal year. Amazon shares added 1.6 per cent, even as workers at seven of its facilities went on strike. Amazon says it doesn’t expect an impact on its operations.

US Treasury yields resumed their climb on Thursday as stocks recovered from their steep dive in the wake of the Federal Reserve’s hawkish outlook. The US dollar gave back some of Wednesday’s gains, and gold rallied as investors grew accustomed to the reality that the central bank would take a slower, more measured approach to policy easing in the coming year.

Also Read: Infosys, Wipro ADRs surge over 3% on NYSE after Accenture Q1 earnings beat Wall Street estimates

Global markets today

European stocks dived, setting a course for their biggest percentage drop in five weeks as the Fed’s hawkish signal sent investors fleeing riskier assets. MSCI’s gauge of stocks across the globe fell 2.62 points, or 0.31 per cent, to 842.82. The STOXX 600 index fell 1.49 per cent, while Europe’s broad FTSEurofirst 300 index fell 30.87 points, or 1.51 per cent.

Emerging market stocks fell 12.44 points, or 1.14 per cent, to 1,082.87. MSCI’s broadest index of Asia-Pacific shares outside Japan closed lower by 1.39 per cent, at 572.98, while Japan’s Nikkei fell 268.13 points, or 0.69 per cent, to 38,813.58.

Yields on 10-year Treasuries jumped past 4.5 per cent to the highest level since May, reflecting the US central bank’s more measured approach to interest rate cuts in the coming year. The yield on benchmark US 10-year notes rose 5.4 basis points to 4.552 per cent, from 4.498 per cent late on Wednesday.

The US dollar’s rally against a basket of world currencies stalled as the market digested the US Fed’s cooler approach to easing. The dollar index, which measures the greenback against a basket of currencies including the yen and the euro, fell 0.02 per cent to 108.24, with the euro up 0.28 per cent at $1.0381.

Also Read: US Fed lowers benchmark rate to 4.25-4.50% for third straight meeting, eyes two cuts in 2025; 5 key highlights

Bitcoin staged a minor recovery after its steep sell-off after the US Fed rate cut decision. In cryptocurrencies, bitcoin fell 0.40 per cent to $100,523.00. Ethereum declined 2.24 per cent to $3,606.76.

Oil gained ground, supported by a reduction in US inventories, but its gains were capped by the Fed’s slower rate cut forecasts, which could hinder economic growth and dampen demand. US crude fell 0.26 per cent to $70.40 a barrel and Brent fell to $73.17 per barrel, down 0.3 per cent on the day.