New York, July 27 (Agency) Wall Street trimmed its losses for the week as investors plowed into value stocks while returning cautiously to so-called growth ones after a tumultuous week for US equity markets. The S&P 500 Index, which tracks stocks of the top 500 US companies, settled on Friday at 5,461 for a gain of 1.1% on the day. For the week, however, the S&P lost 0.8%, adding to the prior week’s 2% decline — the most since mid-April. The technology-heavy Nasdaq Composite Index, which comprises stocks such as Amazon, Apple, Netflix, and Google, closed at 17,362 for a rise of 1% on the day. For the week, the Nasdaq fell 2.1%, after the previous week’s drop of 3.7%, its most since mid-April too.
The Dow Jones Industrial Average, the broadest indicator for US equity markets, finished at 40,589 for an advance of 1.6% on the day. The Dow has been Wall Street’s outlier, rising 0.7% in the latest week for a fourth straight week of gains that put the index up a cumulative 3.8%. Stocks rebounded on Friday after the Personal Consumption Expenditures Index, a US inflation tracker closely followed by the Federal Reserve, grew 2.5% in the year to June, closing in on the central bank’s 2% target that could pave the way for an interest rate cut. The Fed will get its first opportunity to review rates at its policy meeting on July 31, although Wall Street is betting on a cut happening at the central bank’s September 18 meeting. “A cut in September [is] priced in,” economist Greg Michalowski wrote on the ForexLive forum, noting that the Fed appeared on course to cut as much as 67 basis points, or 0.67%, from rates in 2024. The central bank itself has only indicated two rounds of cuts before the end of the year, typically in installments of 25 basis points, or 0.25%, per reduction. The last time the Fed cut rates was in March 2020 — at the onset of the coronavirus pandemic — when it slashed a full 100 basis points, or 1%. Rates are currently in a range of between 5.25% and 5.5%, their highest since 2002.