[New York Stock Exchange] All Major Indexes Rise on December Rate Cut Hopes... Dow Up 1.43%

Kevin Hassett Reported as Leading Candidate for Next Fed Chair
Interest Rate Cut Stance Gains Momentum... U.S. Treasury Yields Decline
September Retail Sales Recovery Slows... Wholesale Prices Meet Expectations
Alphabet Rises on News of Met

All three major indices on the New York Stock Exchange closed higher on the 25th (local time). Investor sentiment was boosted by continued investment in artificial intelligence (AI)-related stocks and growing expectations for a benchmark interest rate cut in December.

UPI Yonhap News

On this day, the blue-chip Dow Jones Industrial Average closed at 47,112.45, up 664.18 points (1.43%) from the previous trading day. The S&P 500 index, which focuses on large-cap stocks, rose by 60.76 points (0.91%) to 6,765.88, and the tech-heavy Nasdaq index gained 153.586 points (0.67%) to finish at 23,025.591.

Investors are closely monitoring factors that could influence next month’s interest rate decision. Bloomberg News reported, citing multiple sources, that Kevin Hassett, Chairman of the White House National Economic Council (NEC), has emerged as a leading candidate for the next Federal Reserve (Fed) Chair. Hassett is considered someone who could reflect President Donald Trump’s preference for rate cuts in monetary policy. In a Fox News interview on the 20th, he stated that if he were the Fed Chair, he would “cut rates right now,” arguing that “all the indicators show that’s what should be done.”

In addition to Hassett, other candidates mentioned as possible successors to Jerome Powell, whose term as Fed Chair ends in May 2026, include Fed Governor Christopher Waller and former Fed Governor Kevin Warsh. Treasury Secretary Scott Bessent said in a CNBC interview that President Trump may announce his nominee for the next Fed Chair before Christmas, on the 25th of next month.

Expectations for a rate cut next month, which spread late last week, are heating up the overall market. John Williams, President of the Federal Reserve Bank of New York, mentioned the possibility of a December rate cut on the 21st, and the following day, Governor Waller also expressed support for a rate cut at the next meeting. According to the CME FedWatch tool, the probability that the Fed will lower the benchmark rate-currently at 3.75-4.0%-by 0.25 percentage points in December is 82.7%.

As a result, U.S. Treasury yields are also declining. The yield on the 10-year U.S. Treasury note, the global benchmark for bond yields, fell by 3 basis points (1bp = 0.01 percentage point) from the previous day to 4.0%. The yield on the 2-year Treasury note, which is sensitive to monetary policy, dropped by 2 basis points to 3.46%.

Ron Albahari, Chief Investment Officer (CIO) at LNW, commented, “Until last Friday, the probability of a Fed rate cut next month was 40%, but now it has risen to 80%.” He added, “The market is extremely focused on the rate cut issue. While it’s impossible to predict the future, there is a growing sentiment that the Fed will cut rates on December 10, and this could support a ‘Santa Claus rally.’”

September’s retail sales and wholesale price indicators have also fueled expectations for a rate cut. According to the U.S. Census Bureau under the Department of Commerce, retail sales in September reached $733.3 billion, up just 0.2% from the previous month. This figure is below both August’s 0.6% increase and Bloomberg’s forecast of 0.4%, suggesting a slowdown in the recovery of consumer spending, which accounts for two-thirds of the U.S. economy. The Producer Price Index (PPI) for September rose 0.3% from the previous month, matching market expectations. Despite higher costs due to increased tariffs, companies have been reluctant to raise prices significantly out of concern for weakening consumer demand. As a result, some of the factors that could make the Fed hesitate to cut rates due to inflation concerns have eased.

Investors are now awaiting the remaining economic indicators for this week, including September’s durable goods orders and weekly initial jobless claims, both of which will be released on the 26th. The Fed’s Beige Book, which provides an assessment of the economy, is also scheduled to be released the following day.

By stock, Alphabet, Google’s parent company, rose 1.62%. Meta Platforms, Facebook’s parent company, saw its share price rise on news that it is considering adopting Google’s AI chips. Alphabet had surged 6.28% the previous day on positive reviews of Google’s AI, Gemini 3. Meta jumped 3.78%, while Microsoft and Apple rose 0.63% and 0.38%, respectively. In contrast, Nvidia fell 2.59%.

Meanwhile, the U.S. stock market will be closed on the 27th for Thanksgiving and will close early at 1 p.m. on the 28th.