Wall Street Rallies as Rate Cut Hopes Rise Despite Tech Slump

Wall Street's rally continued as economic data fueled hopes for a Fed rate cut in December, with Nasdaq gains limited by Nvidia's decline. Consumer confidence weakened while major stock indexes closed positive. Analysts anticipate a new Fed Chair announcement and continued interest rate reductions through 2026.

Wall Street continued its impressive rally on Tuesday, fueled by economic data suggesting the potential for another Federal Reserve rate cut in December. However, gains in the Nasdaq were curbed by a dip in Nvidia shares. All three major U.S. stock indexes finished in the green, with the Dow Jones leading the charge.

In a day of mixed signals, economic reports from the Commerce and Labor departments showed a cooling in inflation and softened spending, likely due to the government's prolonged shutdown. Meanwhile, consumer confidence has fallen sharply, shown in recent Conference Board reports. Market strategist Paul Nolte highlighted the Fed's shift towards rate cuts in response to job market weaknesses.

Amid rising expectations of interest rate cuts, U.S. Treasury Secretary Scott Bessent hinted at a pre-Christmas announcement for the next Fed Chair pick, widely speculated to be White House adviser Kevin Hassett. As the Dow surged by 664.18 points, healthy retail earnings buoyed the S&P 500, while technology and energy sectors faced challenges.

(With inputs from agencies.)