US stocks surged on Friday as hopes of softening interest rates boosted the risk appetite. All major US equity indices jumped, with the Dow and the S&P 500 reaching their best closing levels since reaching record highs in mid-July. The Dow spiked 462.30 points or 1.1 percent to 41,175.08, the Nasdaq surged 258.44 points or 1.5 percent to 17,877.79 and the S&P added 63.97 points or 1.2 percent to 5,634.61. For the week, the Dow jumped 1.3 percent, the Nasdaq soared 1.4 percent and the S&P 500 spikedby 1.5 percent.
Stocks witnessed an excellent bounce amid soaring commodity prices despite broad worries on geopolitical front as highly anticipated remarks by Federal Reserve Chair Jerome Powell indicated the central bank is prepared to begin lowering interest rates. The time has come for policy to adjust," Powell said at the Jackson Hole Economic Symposium. Powell noted that US inflation is now much closer to the Fed's objective.
Meanwhile, in a separate update, Commerce Department on Friday showed a sharp increase in new home sales in the U.S. in the month of July. The Commerce Department said new home sales spiked by 10.6 percent to an annual rate of 739,000 in July after gaining by 0.3 percent to an upwardly revised rate of 668,000 in June. The new home sales hit their highest annual rate since hitting 741,000 in May 2023. The sharp increase in new home sales partly reflected strength in the West, where new home sales jumped by 33.8 percent to 194,000.
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