• Major U.S. stock indexes hit record highs, driven by a tech rally and comments from Federal Reserve Chair Jerome Powell.
• Salesforce and Marvell Technology led the charge, with their shares jumping significantly.
• Powell's remarks about the economy's strength and the potential for cautious rate reduction further boosted the rally.
• Investors are now awaiting further economic data, which could influence the market's direction.

The U.S. economy witnessed a significant development as all three major U.S. stock indexes - the Dow Jones Industrial Average, the S&P 500, and the Nasdaq Composite - scored record closing highs on Wednesday, December 4, 2024.

The Dow Jones Industrial Average rose by 308.91 points, or 0.69%, to 45,014.44. The S&P 500 gained 36.59 points, or 0.60%, to 6,086.47, and the Nasdaq Composite gained 254.21 points, or 1.30%, to 19,735.12.

This rally was primarily driven by the technology sector, with Salesforce and Marvell Technology leading the charge. Salesforce, the enterprise cloud company, saw its shares jump by 11% after beating analyst estimates for third-quarter revenue and raising the lower end of its annual revenue forecast. This positive performance also had a ripple effect on other cloud companies, which advanced as well.

Marvell Technology, a chipmaker, rallied 23.2% after forecasting fourth-quarter revenue above analyst estimates. This led to a 1.7% rise in an index of semiconductors, with Nvidia also up by 3.5%.

Powell's Remarks and Market Expectations

The rally was further boosted by comments from Federal Reserve Chair Jerome Powell, who stated that the economy is stronger than it appeared in September when the central bank began cutting interest rates.

This allows policymakers to potentially be a little more cautious in reducing rates further. Powell's comments, along with a Fed economic activity report known as the Beige Book, added to the upbeat tone in the market. The report indicated that U.S. economic activity has expanded slightly in most regions since early October.

Investors are now expecting a third consecutive interest-rate cut at the central bank's Dec. 17-18 meeting. This expectation is based on recent economic data, which has confirmed the likelihood of a rate cut in December. The market is also eagerly awaiting monthly U.S. jobs data due on Friday and jobless claims data on Thursday.

Global Market Outlook

In the global context, the Indian stock market is expected to open on a cautious note amid mixed cues from global peers. The Sensex rose 110.58 points, or 0.14%, to close at 80,956.33, while the Nifty 50 settled 10.30 points, or 0.04%, higher at 24,467.45. Asian markets traded mostly higher on Thursday following the overnight rally on Wall Street.

In the past, similar events have occurred where positive comments from Federal Reserve officials and strong performances from key companies have led to significant rallies in the stock market. For instance, in 2019, the U.S. stock market experienced a significant rally following positive comments from Federal Reserve officials and strong quarterly results from key companies.