US close: Stocks extend rate cut-fuelled rally another session

dl nyse new york stock exchange new york city nyc wall street wall st nasdaq markets trading finance unsplash — Sharecast / David Vives via Unsplash

Wall Street stocks closed higher on Monday as the Dow Jones Industrial Average managed to build on its record close yet again.

At the close, the Dow Jones Industrial Average was up 0.15% at 42,124.65, while the S&P 500 advanced 0.28% to 5,718.57 and the Nasdaq Composite saw out the session 0.14% firmer at 17,974.27.

The Dow closed 61.29 points higher on Monday as the blue-chip index narrowly extended its FOMC interest rate decision-fuelled rally into another session.

Monday's moves followed the Fed's decision to cut benchmark overnight interest rates by 50 basis points, using its first cut in four years to take investors, who had broadly expected a more restrained 25 basis point cut, largely by surprise.

On the macro front, a preliminary reading of S&P Global's US manufacturing purchasing managers index fell to 47 in September, down from 47.9 in August and going against expectations of an increase to 48.5. The services PMI eased to 55.4 in September, down from 55.7 in August but marginally above market forecasts for a reading of 55.3, while the composite PMI edged lower to 54.4, down from 54.6 but ahead of expectations for a print of 54.3,

Elsewhere, Federal Reserve Bank of Atlanta head Raphael Bostic said starting the central bank's cutting cycle with a large move would help bring interest rates closer to neutral levels as the risks between inflation and employment become more balanced, while Minneapolis Fed boss Neel Kashkari expects policymakers to ease the pace of interest rate cuts going forward.

In the corporate space, chipmaker Qualcomm has reportedly approached Intel about a potential takeover, with the latter's CEO, Cristiano Amon, said to be involved in the talks.

Reporting by Iain Gilbert at Sharecast.com

Dow Jones - Risers

Intel Corp. (INTC) $22.56 3.30%
Boeing Co. (BA) $156.29 1.96%
Walmart Inc. (WMT) $80.33 1.61%
Visa Inc. (V) $288.63 1.36%
International Business Machines Corporation (CDI) (IBM) $220.50 1.29%
Chevron Corp. (CVX) $147.54 1.28%
McDonald's Corp. (MCD) $299.06 0.75%
3M Co. (MMM) $135.64 0.65%
Dow Chemical Co. (DOW) $52.04 0.64%
Caterpillar Inc. (CAT) $371.37 0.64%