US Stocks Rise After Fed Cuts Rate     12/10 15:43

   The U.S. stock market rose to the edge of its record on Wednesday after the 
Federal Reserve cut its main interest rate to bolster the job market, and hopes 
strengthened for more cuts to come in 2026.

   NEW YORK (AP) -- The U.S. stock market rose to the edge of its record on 
Wednesday after the Federal Reserve cut its main interest rate to bolster the 
job market, and hopes strengthened for more cuts to come in 2026.

   The S&P 500 climbed 0.7% and finished just shy of its all-time high, which 
was set in October. The Dow Jones Industrial Average jumped 497 points, or 1%, 
and the Nasdaq composite rose 0.3%.

   Wall Street loves lower interest rates because they can boost the economy 
and send prices for investments higher, even if they potentially make inflation 
worse.

   Wednesday's cut to interest rates was widely expected and did not move 
markets much by itself. But some investors found encouragement from comments by 
Fed Chair Jerome Powell, which they said were less forceful about shutting down 
the possibility of future cuts than they had been anticipating.

   Powell said again on Wednesday that the central bank is in a difficult spot, 
because the job market is facing downward pressure when inflation is 
simultaneously facing upward pressure. By trying to fix one of those problems 
with interest rates, the Fed usually worsens the other in the short term.

   Powell also said for the first time in this rate-cutting campaign that 
interest rates are back in a place where they're pushing neither inflation nor 
the job market higher or lower. That gives the Fed time to hold and reassess 
what to do next with interest rates as more data comes in on the job market and 
on inflation.

   "We are well positioned to wait and see how the economy evolves," Powell 
said.

   But he also said no one at the Fed is expecting a hike to interest rates in 
their "base case" anytime soon, and he spent much of his discussion in a press 
conference following the rate announcement talking about the job market.

   After voting on Wednesday's cut, Fed officials released projections for 
where they see the federal funds rate potentially ending 2026. The median 
member is penciling in one more cut by the end of next year, the same as three 
months earlier.

   That projection is under the microscope because Fed officials had seemed 
unusually split about how much more help the economy may need from lower 
interest rates. With inflation stubbornly above the Fed's 2% target, some 
officials had been saying it was the bigger threat for the economy rather than 
the job market.

   In Wednesday's vote, two Fed officials voted against the cut of a quarter 
percentage point because they did not want to reduce rates now. A third 
official, meanwhile, voted against Wednesday's cut because he wanted a deeper 
reduction of half a percentage point.

   In the bond market, Treasury yields eased as hopes rose for additional cuts 
to interest rates in 2026.

   Traders are now betting on a 71% chance that the Fed will cut the federal 
funds rate at least twice next year. That's up from the 64% chance seen shortly 
before the Fed announced its decision, according to data from CME Group.

   The Fed also announced a program where it will buy shorter-term Treasurys to 
help keep the financial system running smoothly. It's not a large-scale program 
like past efforts by the Fed to buy bonds to keep interest rates low and 
stimulate the economy, but it helps keep shorter-term rates lower than they 
otherwise would be.

   The yield on the 10-year Treasury fell to 4.15% from 4.18% late Tuesday. The 
two-year yield fell more and sank to 3.53% from 3.61%.

   On Wall Street, GE Vernova flew 15.6% higher after the energy company raised 
its forecast for revenue by 2028, doubled its dividend and increased its 
program to buy back its own stock.

   Palantir Technologies added 3.3% after saying the U.S. Navy will use its 
artificial-intelligence platform as part of a $448 million program.

   Cracker Barrel Old Country Store rose 3.5%. The restaurant chain caught up 
in a furor around its logo design reported better results for the latest 
quarter than analysts expected but also cut its forecast for revenue this 
fiscal year, as well as for an underlying measure of earnings.

   On the losing end of Wall Street was GameStop, which fell 4.3% after 
reporting weaker revenue for the latest quarter than analysts expected. The 
video-game retailers' profit topped forecasts, though.

   All told, the S&P 500 rose 46.17 points to 6,886.68. The Dow Jones 
Industrial Average jumped 497.46 to 48,057.75, and the Nasdaq composite gained 
77.67 to 23,654.16.

   In stock markets abroad, indexes were mixed amid mostly modest movements 
across Europe and Asia.