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Stocks end higher as hopes for less aggressive Fed grow
STORY: U.S. stocks surged on Friday, with each of the three major indexes notching their biggest weekly percentage gains in four months, after a Wall Street Journal report said that some Federal Reserve officials expressed a desire to slow down the pace of interest rate hikes soon, raising hopes the central bank may be poised to adopt a less aggressive policy stance. The Dow rose about 2.5%, while the S&P 500 and Nasdaq both jumped roughly two and a third percent.Ross Mayfield, investment strategy analyst at Baird, said a possible debate among Fed officials on a smaller interest rate hike in December was welcome news to investors.”The market has been searching for just a hint of a Fed pivot for months now. And it’s been on the wrong side of the boat before. But here we are again. There are some headlines that the Fed is looking to ease the pace of rate hikes into the end of the year. I think that’s given the market enough juice to sustain a little bit of a rally. We’ll see if it holds on to that. But I think that’s… that’s what we’re seeing.”The Wall Street Journal report helped boost rate-sensitive growth stocks including Apple, Amazon and Tesla.But dismal earnings from Snap weighed on tech companies that rely heavily on ad revenue such as Meta Platforms, Twitter and Pinterest.Snap plunged almost 30% after posting its slowest quarterly revenue growth in five years, and forecast zero revenue growth for the fourth quarter.And shares of American Express fell after the credit card company said it built bigger provisions to prepare for potential defaults as an economic downturn looms.