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  • Fed’s Powell says they will “act as appropriate” to sustain economic expansion.
  • Defensive sectors start the day under pressure to reflect upbeat sentiment.
  • Communication services and energy shares lead the rally.

Major equity indexes in the United States started the day in the positive territory on renewed hopes of aggressive Fed rate cuts after FOMC Chairman Powell’s cautious tone in his prepared remarks to be delivered at his semi-annual testimony before the Congress. As of writing, the Dow Jones Industrial Average was up 0.45% on the day while the S&P 500 and the Nasdaq Composite were adding 0.55% and 1%, respectively.

“It appears trade uncertainties and concerns about the global economy continue to weigh on the U.S. Economic outlook -prepared testimony,” Powell said in his remarks and reiterated that the Fed will  act ‘as appropriate’ to sustain the U.S. economic growth.

Among the 11-major S&P 500 sectors, risk-sensitive Technology and Communication Services indexes both gain more than 1% to reflect upbeat market sentiment. On the other hand, the defensive sectors, Real Estate and Utilities, are posting small losses in the early trade.