Markets surge on US rate cut optimism

EQUITIES jumped yesterday after data showing job losses in the US private sector fanned optimism for more interest rate cuts and overshadowed a partial shutdown of the country’s government.

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TRADERS work on the floor of the New York Stock Exchange (NYSE), in New York City.

(AFP)

Tech firms led the way higher as a deal between South Korea’ biggest chip firms and OpenAI added fuel to the Al-led rally that has helped push markets to record highs.

While debate rages over the impact of the closure of some US departments owing to a standoff between lawmakers in Washington, investors continue to focus on the outlook for more Federal Reserve rate cuts.

And hopes were given a boost Wednesday by figures from payrolls firm ADP showing companies shed 32 000 posts last month, confounding forecasts for a gain of more than 50 000.

The data was the latest in a string of below-par reports indicating the labour market in the world’s top economy continues to slow and will give more impetus for the Fed to cut rates twice more before the end of the year.