The S&P 500 closed at a record high after US economic data suggested a slowdown in the labour market without signalling weakness in overall growth. Softer jobless claims and subdued private hiring figures reinforced expectations that the Federal Reserve (Fed) is on track to lower interest rates in September. Investors interpreted the numbers as evidence that inflationary pressures are easing, while the economy remains resilient enough to avoid a sharp downturn.
This optimism on Wall Street carried over to Asian markets, where major indices followed the US rally. Japan, Taiwan, and China all posted gains, reflecting growing confidence that a Fed rate cut will provide further support to global growth.
US Treasury yields fell to four-month lows as bond traders priced in an almost certain quarter-point rate cut in September. Market participants now see a 95% probability that the Fed will ease policy, further anchoring expectations for a shift away from the aggressive tightening cycle of the past two years.
S&P 500 trades in record highs
The S&P 500 is trading back in the 6,500 region whilst trying to overcome its late August record high at 6,508. Further up lies the 6,600 mark.
Potential slips may find support around the mid-August high at 6,481 and the 22 August peak at 6,479.