U.S. Stock Market Rebounds Amid Fed's Rate Outlook and Trade Tariff Concerns

U.S. stocks regained early losses as investors processed the Federal Reserve's interest rate outlook amid ongoing trade tariff concerns. Major indexes closed higher, with volatility cooling. The Fed maintained rates, projected inflationary growth, and slight unemployment rise by 2025, while traders anticipate a cut this year.

U.S. stock indexes rebounded on Thursday as investors navigated the Federal Reserve's interest rate outlook against persistent concerns over trade tariffs. Despite previous sell-offs due to President Donald Trump's uncertain trade policies, major indexes saw gains as traders focused on the Fed's plans to maintain current rates and forecast two rate reductions by year-end.

The central bank projects slightly reduced growth and increased inflation for the year, with a modest unemployment rise expected by 2025. This comes as recent economic data hints at a cooling economy, prompting the Fed's dovish stance. Short-term gains were notable despite the S&P 500 and Nasdaq undergoing a technical correction of a 10% drop from record highs.

Despite trade policy fears possibly fueling inflation and disrupting monetary easing, U.S. stocks showed resilience. By midday, significant indices like the Dow Jones, S&P 500, and Nasdaq showed notable increases. While some sectors faced challenges, communications services and growth stocks showed promise with notable rebounds in giants like Meta and Nvidia.

(With inputs from agencies.)