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Stocks buoyed by rate cut expectations, sterling choppy on UK budget surprise

27 November 2025 09:24 (UTC +04:00)

Global stocks rallied for a fourth straight day on Wednesday as expectations for a U.S. Federal Reserve rate cut remained elevated, while sterling was whipsawed by Britain's fiscal watchdog inadvertently publishing new forecasts before a UK budget release, APA reports, citing Reuters.

On Wall Street, U.S. stocks closed higher, led by gains in the tech (.SPLRCT), sector that rose about 1.5%, in part due to a jump of nearly 7% in Dell Technologies (DELL.N), after its quarterly results and outlook.

Equities have rallied since Friday, when expectations for a December rate cut from the Federal Reserve jumped after New York Fed President John Williams said interest rates can fall in the near term even as other policymakers insisted borrowing costs should remain steady for now.

Those expectations were buttressed by comments this week from San Francisco Federal Reserve Bank President Mary Daly and Fed Governor Christopher Waller in support of a December cut.

"We've seen some dovish comments from the Fed, particularly the New York Fed ... which I think are signaling a potential cut next month, and I think that that's what's been driving the markets lately," said Matthew Keator, managing partner in the Keator Group, a wealth management firm in Lenox, Massachusetts.

Economic data on Wednesday showed weekly initial jobless claims dropped 6,000 to a seasonally adjusted 216,000 for the week ended November 22, the lowest level since April and below the 225,000 estimate of economists polled by Reuters.

The Dow Jones Industrial Average (.DJI), rose 314.67 points, or 0.67%, to 47,427.12, the S&P 500 (.SPX), gained 46.73 points, or 0.69%, to 6,812.61 and the Nasdaq Composite (.IXIC), climbed 189.10 points, or 0.82%, to 23,214.69.

Expectations for a 25 basis point cut from the Fed held at more than 80%, according to CME's FedWatch Tool, opens new tab, well above the 30.1% from a week ago.

U.S. markets will be closed on Thursday for the Thanksgiving holiday and will have an abbreviated session on Friday.

MSCI's gauge of stocks across the globe (.MIWD00000PUS) jumped 9.31 points, or 0.94%, to 1,000.37, and was on pace for its fourth straight session of gains, its longest streak in a month. The MSCI index has gained 3.3% over the four-day rally, its biggest four-day percentage gain since mid-May.

The pan-European STOXX 600 (.STOXX) index closed up 1.09% to record its biggest daily percentage gain in two weeks.