U.S. Markets Face Mixed Signals as Rate Outlook Shifts

U.S. stocks showed little change after a mixed session, as new Federal Reserve guidance indicated fewer rate cuts and higher inflation in 2025. Despite a slight increase in economic optimism, concerns about future rate hikes led to market skittishness, barely breaking the Dow's ten-session losing streak.

In a session marked by both relief and apprehension, U.S. stocks ended Thursday with minimal change. This stabilization followed a sharp dip as markets absorbed the Federal Reserve's adjusted forecast of fewer interest rate cuts for 2025 compared to initial expectations.

Economic data aligned with the Fed's outlook, showing a significant drop in weekly initial jobless claims and a revised GDP growth for the third quarter at 3.1%. However, market anxiety lingered over potential rate hikes linked to rising inflation, failing to sustain early-session gains.

The Dow Jones Industrial Average managed to end its ten-session losing streak with a modest rise, while the S&P 500 and Nasdaq Composite sustained slight losses. Traders, remaining cautious, foresee minimal rate adjustments ahead, shifting their focus to regulatory changes under the new Trump administration.