Stocks Rally Amid Economic Data, with Focus on Federal Reserve’s Powell

Growth in US services slows, and inflation gauge hits a four-year low as hiring surges since July. The stock market saw a rebound following new economic data, which did not significantly alter the expectations for Federal Reserve rate cuts this year, despite recent worries over potential delays in policy easing.

Investors, looking forward to insights from Federal Reserve Chair Jerome Powell, were reassured by reports indicating a service sector slowdown and a significant drop in inflation rates. A separate report on private sector employment highlighted a strong labor market, contributing to a pause in the equity market’s recent decline. Treasury yields decreased from their peak levels as traders reconsidered their rate cut forecasts after recent economic robustness and a shift towards a hawkish stance by Federal Reserve officials. This reconsideration has cast doubt on the Fed’s ability to achieve its forecast of three rate cuts by the end of the year, affecting market sentiment. The S&P 500 surged past 5,200, recovering from its largest monthly decline. Meta Platforms Inc. led the rise among large-cap stocks, while Intel Corp. faced challenges, reporting increased losses in its manufacturing operations. Meanwhile, 10-year Treasury yields rose by five basis points to 4.40%, and oil prices increased following OPEC+ confirming ongoing supply restrictions.

Corporate Updates:

• Walt Disney Co., ( $DIS) under CEO Bob Iger, is on track to win a proxy fight against Nelson Peltz’s Trian Fund Management, with Vanguard Group Inc. supporting Disney’s board nominees.
• Ford Motor Co. ( $F) reported a 7% increase in US auto sales for the first quarter, driven by high demand for its gas-electric hybrids, despite the challenging launch of its redesigned F-150 pickup.
• Blue Owl Capital Inc. ( $OBDC) has reached an agreement to acquire Kuvare Asset Management, highlighting the trend of private-market investment firms seeking opportunities in the insurance sector.
• Cal-Maine Foods Inc. ( $CALM) exceeded earnings and sales expectations in its third quarter, setting a company record for egg sales volumes.
• Dave Calhoun, Boeing Co.’s ( $BA) CEO, announced his plans to step down later this year and will also leave his position on the board of Caterpillar Inc.
• Mastercard Inc. ( $MA) is set to increase some credit card fees starting April 15, following a $30 billion settlement over swipe fees with Visa Inc., aimed at alleviating costs for retailers.
• Spotify ( $SPOT) Technology SA intends to raise its service prices in several key markets for the second time in a year, as part of its strategy to achieve long-term profitability.