Investing.com — The S&P 500 closed above 5,500 for the first time ever on Tuesday, buoyed by a surge in Tesla shares and optimism about interest rate cuts, after Federal Reserve Chairman Jerome Powell praised recent inflation progress.
As of 4 p.m. ET (8 p.m. GMT), the stock was up 0.7 percent to close at a record high of 5,510.65, its 32nd all-time high this year. The stock was up 147 points, or 0.4 percent, while Three was up 0.7 percent to close at a record high of 18,029.18.
Powell acknowledges rising inflation but says more confidence needed to cut rates
The Fed chairman said the Fed has “made substantial progress in lowering inflation” toward the central bank’s goal, but added that the central bank needs more confidence that inflation is on a path to sustainably lower inflation before beginning the process of lowering interest rates.
Traders now expect a 64% chance of a September rate cut, up from about 61% last week, according to Investing.com.
The comments came just a day before the Fed’s June meeting scheduled for Friday and the release of further insights into the labor market.
Ahead of the monthly employment report, the May job openings and job separations report, a measure of labor demand showed 8.14 million job openings, up from 7.92 million in April and above economists’ expectations of 7.96 million.
The labor sector has been booming despite high inflation and interest rates, key considerations for the Fed as it cuts interest rates.
Tesla surges on better-than-expected results Second Quarter Delivery
Shares of Tesla Inc. (NASDAQ:) rose 10% after the electric car maker said it delivered 443,956 electric vehicles in the second quarter, beating expectations of 438,019.
Wedbush Securities reported Tuesday that better-than-expected deliveries in the second quarter signaled a “big comeback” for the electric car maker and that the worst is probably over.
Wedbush added that the delivery update comes just weeks before Tesla’s second-quarter earnings report, scheduled for July 23, as well as Robotaxi Day on Aug. 8, the latter event where the EV maker is expected to tout the next phase of its self-driving story.
Is Paramount Global involved?
Paramount Global (NASDAQ:) rose nearly 8% after The New York Times reported that billionaire Barry Diller is considering a purchase deal for the company. The news came on the heels of multiple media reports that Warner Bros. Discovery (NASDAQ:) may be considering a streaming partnership with Paramount Global.
Boeing (NYSE:) shares fell about 1% after the Associated Press reported that the Department of Justice is waiting for the company to accept a plea deal to settle fraud charges related to the two fatal crashes of its 737 MAX jets.
Shares of electric vehicle maker Polestar Automotive (NASDAQ:) fell more than 1% after the company reported a first-quarter operating loss.
(Peter Nurse and Amber Warrick contributed to this article.)
