On Thursday, the 2nd of May 2019, the Global equity market had shredded off its earlier gains, posting a plunge for second consecutive day, while the dollar became much robust and bond yields rose higher after Federal Reserve Chair Jerome Powell had evaded possibilities of any rate cut in a near-term outlook.
Citing Bloomberg data, on last August, about 54 percent of analysts’ poll had been betting on an interest rate cut, while the figure had now unsurprisingly fallen to 2 percent. As earnings season for the Q1, 2019, had winded down, investors’ focus had now been back on to economic macro data and amid a dampened market expectation following Powell’s comments over rate-cut decision, an abrupt downturn of global equity market would likely to be on the cards, analysts suggested.
Addressing to a tempestuous investors’ sentiment following Fed’s Powell’s comment, a Chief market economist at Spartan Capital Securities in New York, Peter Cardillo said, “Investors are going to dwell on the Powell comments.
He said there is no need to cut rates anytime soon or indicated that next move might not be a rate cut”. While global equities had gave up its three-day long winning streak on Wednesday (May 1st) following May FOMC minutes, the American dollar index measured against a basket of six major currencies on an average, gained 0.16 percent, with euro wrapped up the day 0.14 percent lower to $1.1178 and the British currency lost 0.17 percent.
All of the three key indexes of Wall St. had ended the day in negative territory, while Dow lost 0.46 percent and S&P 500 remained closure to its all-time high, winded up the day muzzled by 0.21 percent, while the tech-heavy Nasdaq Composite shed 0.16 percent.