Wall Street Rallies Amid Trump Assassination Attempt, Fed Rate Cut Hopes

Wall Street closed higher on Monday due to increasing expectations of a second Trump presidency following a failed assassination attempt. Investor optimism was also buoyed by predictions of an imminent Federal Reserve interest rate cut. All major U.S. stock indexes showed gains, with significant surges in economically sensitive and crypto stocks.

Wall Street closed higher on Monday, propelled by growing optimism of a second Trump presidency following a failed assassination attempt and expectations of a Federal Reserve interest rate cut as early as September.

All three major U.S. stock indexes posted gains, led by economically sensitive small caps and transportation stocks outperforming the broader market.

The unsuccessful assassination attempt on Trump, the likely Republican presidential nominee, boosted his chances for election, indicating a potential shift towards a more hawkish trade policy, tax cuts, and deregulation. PredictIt raised Trump's election odds to 67 cents from 60 cents earlier, while Biden’s odds fell to 26 cents.

According to Sam Stovall, chief investment strategist at CFRA Research, the attempt did not alter economic forecasts or the anticipated Fed rate cuts. Sentiment was further lifted by views that the Fed would cut rates up to three times by year-end, with Fed Chair Jerome Powell expressing confidence in avoiding recession.

The S&P 500, Nasdaq Composite, and Dow Jones Industrial Average all saw gains, backed by strong performances from stocks like Goldman Sachs and Trump Media & Technology Group, while energy and Chinese stocks fell.