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Global stock markets rose Thursday as several central banks joined the Fed in indicating lower interest rates are on the way, with US markets reaching fresh records.
All three major Wall Street indices finished at all-time highs for a second straight day Thursday, led by the Dow Jones Industrial Average, which rose almost 0.7 percent.
The Federal Reserve said Wednesday it still saw three cuts to US borrowing costs in 2024 after voting to hold interest rates at a 23-year high.
Analysts said the gains partly reflected market relief after the Fed's rate cut predictions.
But equally as important, there is just as "much excitement about this market" due to the strength of economic fundamentals, said Art Hogan of B. Riley Wealth, citing buoyant existing home sales data published Thursday as further corroboration of a solid economic outlook.
The day's gains came despite a 4.1 percent drop in Apple shares after the US Department of Justice confirmed it was suing the company over allegations it illegally maintained a monopoly for its iPhone by stifling competition and imposing exorbitant costs on consumers.
But Apple's fall was countered by a flourishing trading debut for social media company Reddit, which soared 48 percent after pricing at the top of its range in an initial public offering (IPO).
Reddit's robust performance lifted expectations of other IPOs, benefitting large banks, including Goldman Sachs, which jumped 4.4 percent.
- England and Norway pause -
Following the Fed, the Bank of England and Norway's Norges Bank similarly held rates steady on Thursday, but also suggested they could soon cut should inflation continue to ease.
"Like the US Federal Reserve yesterday, BoE policymakers appear keen to validate financial market expectations of rate cuts starting in summer," said Kallum Pickering, senior economist at Berenberg Bank.
And the Swiss National Bank (SNB) on Thursday became the first major central bank to cut rates since the end of the current global tightening cycle, claiming the battle against inflation was working.
In European stock markets, Frankfurt and Paris reached new all-time peaks before pulling back. London gained almost 2 percent.
Asian markets finished mostly higher, with Japan's Nikkei and the Hong Kong Hang Seng Index rising sharply, while the Shanghai composite edged lower.
Among commodities, gold hit a fresh record of $2,220 an ounce, before retreating, as US rate cuts could weigh on the dollar. And oil continued to slide on profit taking after hitting a five-month high earlier this week.
- Key figures around 1640 GMT -
New York - Dow: UP 0.7 percent at 39,781.37 points (close)
New York - S&P 500: UP 0.3 percent at 5,241.53 (close)
New York - Nasdaq Composite: UP 0.2 percent at 16,401.84 (close)
London - FTSE 100: UP 1.9 percent at 7,882.55 (close)
Paris - CAC 40: UP 0.2 percent at 8,179.72 (close)
Frankfurt - DAX: UP 0.9 percent at 18,179.25 (close)
EURO STOXX 50: UP 1.0 percent at 5,052.31 (close)
Tokyo - Nikkei 225: UP 2.0 percent at 40,815.66 (close)
Hong Kong - Hang Seng Index: UP 1.9 percent at 16,863.10 (close)
Shanghai - Composite: DOWN 0.1 percent at 3,077.11 (close)
Euro/dollar: DOWN at $1.0861 from $1.0923 on Wednesday
Dollar/yen: UP at 151.65 yen from 151.36 yen
Pound/dollar: DOWN at $1.2653 from $1.2782
Euro/pound: UP at 85.82 pence from 85.44 pence
West Texas Intermediate: DOWN 0.2 percent at $81.07 per barrel
Brent North Sea Crude: DOWN 0.2 percent at $85.78 per barrel
P.Grant--TFWP