Fed Speeches and TSM Sales Boost Stocks as Rate Cut Anticipated

Following a strong week for US stocks, futures contracts signaled further gains on Friday as investors anticipate a series of Federal Reserve speeches, hoping to clarify the likelihood of a rate cut. The Dow Jones Industrial Average (YM=F) rose by approximately 0.3%, while the S&P 500 (ES=F) and tech-heavy Nasdaq 100 (NQ=F) both saw increases of 0.3% and 0.4%, respectively. This positive trend follows a rebound from April’s slump, driven by mounting confidence that the Fed may reduce interest rates sooner than anticipated due to indications of a weakening labor market. Market participants will closely monitor speeches from Fed officials including Michelle Bowman, Neel Kashkari, and Austen Goolsbee, in search of insights regarding the timing, rate, and probability of a policy shift. Meanwhile, Taiwan Semiconductor Manufacturing Company (TSM), a major contract chipmaker, reported a significant 60% increase in April sales, citing ongoing artificial intelligence (AI) demand and a resurgence in consumer electronics such as smartphones. This news contributed to the continuing optimistic mood in financial markets, as the S&P 500 looks set for a third consecutive weekly gain, representing the strongest performance over six sessions this year. Since hitting a recent low on May 1, the S&P 500 has risen by 3.9%.