Economic Growth and Stock Surge: Fed Rate Cuts and AI Drive U.S. Markets

U.S. stock indexes rebounded, with the S&P 500 nearing record highs amid expectations of Federal Reserve interest rate cuts. The economy saw robust Q3 growth at 4.3%, but mixed signals emerged from consumer confidence and factory production data. Analysts anticipate two rate cuts next year, impacting market dynamics.

U.S. stock indexes soared on Tuesday, with the S&P 500 inching closer to record highs. This surge was powered by economic data that bolstered expectations for Federal Reserve rate cuts next year.

Buoyed by strong consumer spending, the economy grew at its fastest pace in two years in Q3, with a 4.3% increase in GDP, surpassing forecasts. Despite this growth, mixed economic signals emerged, as consumer confidence dropped and factory production stagnated.

Analysts predict two rate cuts next year. Meanwhile, a seasonal 'Santa Claus rally' is anticipated, as trading volumes are expected to thin with the holiday season looming.

(With inputs from agencies.)