US stocks in wild swings as Fed delivers jumbo 50bps rate cut

Investing.com -- US stocks swung between gains and losses after the Federal Reserve delivered a larger 50 basis point rate cut, marking the first cut since March 2020.

By 3:41 p.m. ET (1941 GMT), the benchmark S&P 500 and the tech-heavy Nasdaq Composite was flat, and the 30-stock Dow Jones Industrial Average fell 0.1%, or 29 points. Fed delivers jumbo cut

The Federal Reserve cut interest rates by 50 basis points on Wednesday, and lifted forecasts for further rate cuts this year, as the central bank kicks off a rate-cut cycle to shore up the economy following a prolonged battle against surging inflation.

Heading into the decision, markets were split on whether the central bank would deliver a 25bps or 50 bps cut. The central bank also signaled that is expected to deliver two 25bps rate cuts this year, up from a June forecast for just one cut. 

Today’s announcement is best characterised as a "hawkish 50bps," Capital Economics said in a Wednesday note, noting that the decision to cut by 50bps wasn't unanimous and that the Fed only expects an additional 50 bps of cuts between now and the end of the year.  U.S. Steel rises on report of Nippon Steel deal extension; Intuitive Machines rallies on $5B Nasa contract

Shares in United States Steel (NYSE:X ) climbed after Bloomberg News reported that Nippon Steel had won an extension in the review of its $14.1 billion approach for the American steelmaker.A decision is now likely to be made only after the 2024 elections in November.

Intuitive Machines Inc (NASDAQ:LUNR ) jumped 41% after winning a $5 billion contract from Nasa to provide lunar communications and navigation services.    

In retail stocks, Victoria's Secret & Co (NYSE:VSCO ) was a standout performer, rising 3% after Barclays upgraded the lingerie maker to equal weight from underweight, citing a more balanced valuation. 

(Scott Kanowsky, Ambar Warrick contributed reporting.)

Source: Investing.com