April 20, 2024

The Federal Reserve anticipates implementing rate cuts later this year, although they will not happen immediately. During a speech at Stanford University, Fed Chair Jerome Powell expressed his desire for inflation to decrease even further and stated that the Fed would cut rates if appropriate.

Powell made it clear that this year’s presidential election campaign will not influence the Federal Reserve’s interest rate decisions. The central bank is expected to meet in July and again in September, where all will be watching for decisions on rate cuts.

As a result, the stock market, which had a difficult week, experienced some relief, leading to an increase in all indexes. The Dow Jones Industrial Average jumped 63 points, or 0.1%, to 39,233. The S&P 500 popped about 0.37%, while the tech-heavy Nasdaq Composite rose 0.5%.

Oil and energy stocks are up

Oil prices have surged due to tensions in the Middle East and the ongoing Russia-Ukraine war. As a result, oil and energy stocks performed well on Wednesday.

NRG Energy, a provider of energy and home services, was up 5.6%, trading at $72.5 at the time of writing. The company has recently commenced the repurchase of approximately $251 million of its 2.75% convertible senior notes due in 2048.

Similarly, Marathon Petroleum Corp jumped 3% to $217, and Valero Energy Corp rose 2.8% to $182 at the time of writing.

Beauty and wellness stocks on the decline

Beauty brands have been struggling with sales pressure for some time, and today, they were the worst-performing stocks. Ulta Beauty’s stocks fell over 15% to $442. The move comes after Mayflower Financial Advisors bought a new stake in Ulta Beauty in the fourth quarter. The fund purchased 476 shares, valued at approximately $233,000. Today, Ulta’s CEO admitted at a conference that if Ulta has to compete with Sephora, it has to come up with new ideas.

Estée Lauder’s shares fell 4.3% on Wednesday to $146. The beauty conglomerate recently started selling its products on the Amazon Premium store.

In a similar vein, the shares of Bath & Body Works fell 3.2% to $46 at the time of writing. Institutional investor SG Americas Securities recently acquired 18% of the company’s shares during the fourth quarter.

AI and chip stocks are back

It seems the Fed’s positive approach to rate cuts later this year has boosted AI stocks that were down yesterday. Nvidia, Micron Technology, Western Digital Corp, and Super Micro Computer were up 0.4%, 3.8%, 3.9%, and 2.5%, respectively.

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