Bulls Rally in Final Hour as Fed Cuts Rates

U.S. markets were tepid ahead of the Fed’s decision on interest rates with the major averages showing weakness on the open but some strength ahead of the news. As expected, a quarter-point reduction was announced with the action muted as Wall Street awaited further developments.

Fed Chairman Jay Powell’s comments afterwards were once again scrutinized but this time helped sentiment as the major indexes pushed session highs in the final hour of trading. More importantly, volatility closed below another key level of support and is confirming a continued breakout to fresh all-time highs for the market.

The Dow added 0.4% following the late day push to 27,204. Lower resistance at 27,200-27,400 was cleared but held for the 3rd-straight session with a close above the latter and the all-time high at 27,398 signaling blue-sky territory towards 27,600-27,800.

The Nasdaq climbed 0.3% after testing a 2nd half high of 8,315. Current and lower resistance at 8,300-8,350 was cleared and held with a close above the latter and the all-time high at 8,339 getting 8,450-8,500 in play.

The S&P 500 was also up 0.3% after trading in a 25-point range while tapping a fresh all-time high of 3,050 ahead of the closing bell. Lower resistance at 3,050-3,075 was cleared by a tenth-point but held with a upside potential towards 3,100-3,125 on a close above the latter.

The Russell 2000 lost 0.3% while trading in negative territory throughout the session with the low reaching 1,562. Near-term and upper support at 1,565-1,550 was breached but held with a move below the latter being a slightly bearish development for additional weakness towards 1,540-1,525 and the 200-day moving average.

Utilities and Real Estate paced sector leaders with gains of 0.9% and 0.7%, respectively. Energy and Financials were the only sector laggard after falling 2% and 0.1%, respectively.