February 15, 2025
Finance

S&P 500 Up in Big Reversal as Fed-Cut Bets Mount: Markets Wrap


(Bloomberg) — Stocks are ending the week on a positive note as latest economic readings reinforced speculation the Federal Reserve will cut rates as early as September.

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About 90% of the shares in the S&P 500 gained on Friday — with the index reclaiming its 5,600 mark after a slide in the previous session. Tech rebounded, though smaller firms continued to outperform megacaps. Banks got hit as results from Wells Fargo & Co., JPMorgan Chase & Co. and Citigroup Inc. failed to fuel industry momentum.

Consumers’ expectations for inflation over the next year fell to 2.9%. They saw costs rising at an annual rate of 2.9% over the next 5 to 10 years, also edging down. Earlier data showed US producer prices climbed slightly more than forecast — but categories used to calculate the Fed’s preferred inflation measure, the personal consumption expenditures price index, were not so bad.

“We continue to expect the Fed to join the global rate-cutting cycle in September, with 50 basis points of easing this year,” said Mark Haefele at UBS Global Wealth Management.

Treasury 10-year yields were little changed at 4.21%. The pound is trading at its strongest level in a year versus the dollar and the highest in almost two years against the euro. Japan likely stepped into currency markets prop up the yen soon after US inflation figures came out Thursday, according to a Bloomberg analysis of central bank accounts.

Corporate Highlights:

  • AT&T Inc. suffered a massive hack of customer data — separate from one reported earlier this year — that included records of calls and texts for nearly all of its mobile-phone users for a six-month period in 2022, one of the biggest breaches of private communications data in recent memory.

  • Boeing Co. has notified some 737 Max customers in recent weeks that aircraft due for delivery in 2025 and 2026 face additional delays, another reminder that production of its cash-cow jetliner faces a long road to recovery.

  • Amazon.com Inc.’s artificially intelligent shopping assistant, Rufus, is now available to all US customers following five months of testing with a subset of consumers.

  • Deutsche Lufthansa AG cut its profit outlook for the full year and warned that breaking even at its namesake German unit will be “increasingly challenging” as it grapples with higher unit costs and falling ticket prices.

  • Novo Nordisk A/S’s Ozempic was linked to lower rates of dementia and a range of other mental problems in a University of Oxford study that raises expectations about the diabetes drug’s potential ancillary benefits.

  • Samsung Electronics Co.’s largest union is now calling on employees at one of the company’s most advanced AI memory chip plants to walk off the job, switching tactics after their campaign for higher pay showed signs of losing steam.

  • Taiwan Semiconductor Manufacturing Co.’s $420 billion equity rally this year will get a valuation test next week when it reports earnings, with analysts expecting the chipmaker to raise full-year sales forecasts.

Some of the main moves in markets:

Stocks

  • The S&P 500 rose 0.9% as of 11:07 a.m. New York time

  • The Nasdaq 100 rose 1.2%

  • The Dow Jones Industrial Average rose 0.7%

  • The Stoxx Europe 600 rose 0.9%

  • The MSCI World Index rose 0.8%

Currencies

  • The Bloomberg Dollar Spot Index fell 0.4%

  • The euro rose 0.4% to $1.0908

  • The British pound rose 0.6% to $1.2989

  • The Japanese yen rose 0.7% to 157.77 per dollar

Cryptocurrencies

  • Bitcoin rose 0.6% to $57,887.98

  • Ether rose 0.2% to $3,122.84

Bonds

  • The yield on 10-year Treasuries was little changed at 4.21%

  • Germany’s 10-year yield advanced four basis points to 2.50%

  • Britain’s 10-year yield advanced five basis points to 4.12%

Commodities

  • West Texas Intermediate crude rose 0.6% to $83.12 a barrel

  • Spot gold fell 0.2% to $2,411.36 an ounce

This story was produced with the assistance of Bloomberg Automation.

–With assistance from Cecile Gutscher.

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