S&P 500 hovers near record high as Trump says he'll demand lower interest rates

Published 01/22/2025, 07:17 PM
Updated 01/23/2025, 12:48 PM
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Investing.com – The S&P 500 remained close to record highs Thursday as investors digested more corporate earnings  and remarks from President Donald Trump at Davos in which he said he would demand interest rates be lowered. 

At 12:47 ET (17:47 GMT), the Dow Jones Industrial Average rose 303 points, or 0.7%, while the S&P 500 index was 0.2% higher, and the NASDAQ Composite dropped 0.3%.

Trump says he'll demand Fed drops interest rates at Davos

Trump delivered a speech remotely to the World Economic Conference in Davos, Switzerland, touching on range of topics including interest rates, the US-China trade relationship, and domestic energy policy. 

On interest rates, Trump said he would

"demand that interest rates drop immediately, and likewise they should be dropping all over the world." 
 
The remarks come ahead of the Fed meeting next week, with many on Wall Street expecting the central bank to hold rates steady, 
 
The rate sensitive 2-year Treasury was largely unchanged, however, as he Fed like many other world central banks is independent. 
 
The president did, however, pressure oil prices after saying he would ask Saudi Arabia to lower the price of oil and he reiterated a pledge to accelerate U.S. energy production. 

American Airlines slumps, EA falls on guidance cut; Ge Aerospace shines 

The quarterly corporate earnings season continues Thursday, with more senior companies releasing their results.

GE Aerospace (NYSE:GE) stock rose 7% after the aircraft engine supplier forecast a stronger full-year profit as demand for its high-margin parts and services got a boost from airlines flying older jets to sidestep a persistent shortage of new aircraft.

American Airlines (NASDAQ:AAL) stock slumped 8% after the carrier’s first-quarter earnings outlook on Thursday fell short of expectations, forecasting an adjusted loss per share of 20 cents to 40 cents for the first three months of 2025, breaking from a more upbeat outlook from its rivals.

Electronic Arts (NASDAQ:EA) slumped 17% after the video game maker slashed its guidance for net bookings due to sluggish performance of its soccer titles.

"The drastic cut to Global Football's near-term outlook does not provide a hard reset that investors looked for. Relative to a Battlefield delay, declines in Global Football are more alarming," Oppenheimer said in a note. 

Knight-Swift Transportation (NYSE:KNX) stock rose 4% after fourth-quarter results showed improved operating margins, while Alaska Air (NYSE:ALK) gained 4% after fourth-quarter results topped estimates on the top and bottom lines.

Labor market remains solid

Data released earlier Thursday showed that the number of Americans filing new applications for unemployment benefits rose marginally last week, suggesting that solid job growth likely continued in January.

Initial claims for state unemployment benefits increased 6,000 to a seasonally adjusted 223,000 for the week ended Jan. 18.

However, freezing temperatures that have gripped large parts of the country and fires in Los Angeles could boost claims in the coming weeks.

(Peter Nurse, Ayushman Ojha contributed to this article.)

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