Wall Street Reaches Record Highs

(Patria) - Stock market indices on Wall Street rose for the fourth consecutive week, reaching record highs, while stock prices on European exchanges slightly fell from their record levels.

On Wall Street, the Dow Jones strengthened by 1.2 percent to 40,003 points, while the S&P 500 increased by 1.5 percent to 5,303 points, and the Nasdaq index rose by 2.1 percent to 16,685 points.

The indices have risen for the fourth week in a row and reached record levels. This is mainly due to investors' hopes that inflation in the United States will weaken, which would allow the Federal Reserve to lower interest rates.

Last week, it was announced that consumer prices in April rose slightly less than expected.

Because of this, speculation has resurfaced that the Federal Reserve will cut interest rates twice in the second half of the year, in September and December, by 0.25 percentage points each.

However, inflation remains significantly above the Federal Reserve's target of 2 percent, and new data showed that producer prices in April rose more than expected. This could fuel the growth of consumer prices in the coming months.

Federal officials also reiterate that they are not sure inflation is under control and are not in a hurry to lower interest rates.

Therefore, the question arises as to how realistic the market's estimates for interest rate cuts really are. Especially considering that at the beginning of the year, it was speculated that the Federal Reserve would cut interest rates at least five times this year, a total of 1.5 percentage points.

It seems all attention is focused on what the Fed might or might not do, given that we started the year with expectations that interest rates might even be cut six times, and now those expectations have dropped to one to two cuts, says Silas Myers, director at Mar Vista Investment Partners.

On European exchanges last week, trading was cautious, and indices slipped from the record levels they reached seven days prior.

The London FTSE weakened by 0.2 percent last week to 8,420 points, while the Frankfurt DAX fell by 0.4 percent to 18,704 points, and the Paris CAC by 0.6 percent to 8,167 points.