US stock indexes are rising during trading. On the eve of all three indexes sharply declined, the S&P 500 ended trading in the “bearish” trend zone.
The market is focused on the two-day meeting of the Federal Reserve System (FRS) starting on June 14, during which, as expected, the possibility of increasing the pace of policy tightening will be discussed, given the continued strengthening of inflation in the United States.
Judging by the futures quotes for the rate level, the probability of its rise by 75 bps at the upcoming meeting is estimated by the market at 50%, according to Bloomberg data. Before the publication of Friday’s report of the Ministry of Labor on the dynamics of consumer prices, the market was confident that the rate would be increased by 50 bps in June.
The Fed meeting will take place just a few days after the publication by the US Department of Labor of statistical data showing the acceleration of consumer price growth in the States in May to the maximum since December 1981 of 8.6% in annual terms. Experts considered that this could push the Federal Reserve to a more aggressive rise in the base interest rate, and do not rule out the possibility of raising it by 75 basis points (bp) at once at the June meeting, writes The Wall Street Journal. The last time the US Central Bank raised the rate by this amount was in 1994.
The experts of Barclays (LON:MARK), Jefferies, JPMorgan Chase and Goldman Sachs (NYSE:GS) expect an increase in the rate by 75 bps this week, in particular. Moreover, JPMorgan’s chief US economist Michael Feroli admits the possibility of raising the rate by 100 bps at once.
Thus, against the background of all this, Oracle Corp (NYSE:ARCA) shares. they are adding 8.1% in the price during trading on Tuesday. One of the world’s largest software manufacturers reduced its net profit in the fourth quarter of fiscal year 2022 by 21%, but the adjusted figure and revenue exceeded analysts’ expectations.