By Jesse Cohen
Investing.com - The S&P 500 opened at an all-time high on Thursday, as investor sentiment improved after the Federal Reserve opened the door for a rate cut as early as next month, sparking a rally on Wall Street.
At 10:00AM ET, the S&P 500 was up 30 points, or around 1%, to 2,955, pushing it above its record high of 2,954 reached on May 1.
The blue-chip Dow was up 240 points, or about 0.9%, to 26,744, a move that would take the 30-stock average to its highest level since September 2018.
Meanwhile, the tech-heavy Nasdaq rose 89 points, or roughly 1.1%, to 8,077.
The Fed dropped its pledge to be “patient” following its policy meeting on Wednesday, citing mounting concerns over the economic impact of global trade tensions and subdued inflation.
Instead it said it will “act as appropriate to sustain the expansion” and to “closely monitor the implications of incoming information for the economic outlook.”
Markets are now fully pricing in a rate cut of 25 basis points at the Fed’s next policy meeting on July 30-31, according to Investing.com’s Fed Rate Monitor Tool. A total of 75 basis points of easing is priced in by the end of year.
Many investors viewed the overall tone as more dovish than their expectations, sending the 10-year U.S. Treasuries yield to below 2% for the first time since November 2016.
Gold prices also soared, hitting their best level since September 2013, on bets for three rate cuts by the end of the year.
However, such aggressive rate cuts when stock markets are at all-time highs would be rare, if not unprecedented, leading to some analysts to warn that market expectations of easing may have gone too far.
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-- Reuters contributed to this report