Stocks Surge After Fed Rate Cut
Stocks jumped significantly higher after the opening, following
a rate cut from the Federal Reserve. The averages gave back
roughly half of their early gains by 10:30 but have steadily moved
upward.
The Fed cut the discount rate by half of a percentage point prior
to the opening bell on Friday, signaling a rally to start the
session. The rate cut was designed to inject liquidity into the
cash-strapped markets, and to boost investor optimism.
Crude oil futures for September delivery added
1.4% to $71.98 a barrel on news that a hurricane headed toward the
Gulf of Mexico may threaten rigs and pipelines. Gold
futures for December delivery added 1.3% to $666.80 an ounce.
Around Europe, the U.K.’s FTSE 100 index climbed 3.50% to
6,064.20, while France’s CAC 40 index surged up 1.86% to 5,363.63
and Germany’s DAX index rose 1.49% to 7,378.29.
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Darren Wong
Associate Editor
darrenw@tradingmarkets.com
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