Shares jumped Tuesday morning before settling in modest gains, with Berkshire Hathaway’s latest investments leading the way, after another promising inflation report suggested the Federal Reserve would soon move away from its most aggressive monetary policy in decades.
The S&P 500 jumped 0.9%, the tech-heavy Nasdaq climbed 1.5% and the Dow Jones Industrial Average climbed 0.2%.
The latest gain comes after a reading of October’s producer price index beat economists’ estimates by just 0.2% growth last month, indicating the Fed’s fight to contain inflation may soon be over as inflation data improves. may slow with, Jeffrey Roach, chief economist at LPL Financial, introduced to the Fed. Interest rates will rise to just 0.50% next month and a slower rise to 0.25% soon, a significant improvement after four consecutive 0.75% hikes.
All three major indexes are up 2% or more over the past week, buoyed by growing signs of slowing inflation The Dow had its best day in two years on Thursday after the latest Consumer Price Index reading, the other most closely watched Vali metric tracking inflation.
Taiwan Semiconductor soared 10.5% after Warren Buffett’s firm disclosed a $4.1 billion stake in the chipmaker.
Berkshire Hathaway’s other newly disclosed investments Louisiana-Pacific and Jefferies Financial Group rose 7.8% and 0.3%, respectively, and Paramount rose 5.1% after Buffett disclosed a larger stake in the media giant.
Shares of Chinese firms listed in New York were also among the biggest risers as Beijing-Washington ties appear to be improving after President Joe Biden’s first face-to-face meeting with Chinese President Xi Jinping during his tenure, Alibaba, With Tencent and Pinduoduo each growing the least. 9%.
Despite recent optimism in the market, it's too soon to declare war on inflation, says Bill Adams, chief economist at Comerica Bank. Adams wrote, "Seeing inflation slow temporarily in 2021 only to flare up again in 2022 makes Chair Powell feel jealous, and he doesn't want to make the same mistake twice." before taking your foot off the brake. Large investors hesitate to take an even too bright outlook, with a Bank of America survey of major fund managers released ahead of Tuesday's stock rally revealing a sense of unease among large investors, with a two-year high of 77% of respondents. has predicted. America will enter recession next year.
Shares of Netflix rose 3.7% to $310.20, for their highest close in seven months. The streaming giant's rebound comes after analysts at Bank of America upgraded their rating of Netflix with a $370 price target, indicating nearly 20% upside even after Tuesday's jump, given the company's subscriber growth and Citing the strong path to ad revenue.
Chipping in: Warren Buffett's Berkshire Hathaway picks up $4 billion stake in Taiwanese semiconductor giant TSMC (forbes,
Recession fears hit new high despite slowing inflationforbes,
Credit: www.forbes.com /