US Stocks Surge on Oil Price Drop Amid Fed Rate Hike

The US stock market experienced a significant surge on Thursday as oil prices declined for the second straight day, providing some relief after the Federal Reserve's interest-rate hike. The Fed's decision to raise rates marked its first move under Chair Kevin Warsh, with investors interpreting it as a commitment to managing inflation.

As a result of the policy change, technology shares saw significant gains, with Nvidia and Amazon rising by over 2% each. This was part of broader market sentiment improvement, with eight out of 11 major S&P 500 sectors trading higher. Utilities led the gains, jumping 1%, while the S&P 500 financials index remained flat.

Brett Mitstifer, chief investment officer of private banking and wealth management at Flagstar Bank, noted that 'the start of a hiking cycle can bring volatility, but volatility does not have to end a bull market.' However, he also warned that investors should be prepared for potential further rate hikes in the coming months.

The FedWatch tool from CME indicated a near 51% chance of another interest-rate hike when the central bank meets next in October. Meanwhile, the yield on the benchmark 10-year U.S. Treasury slipped, easing pressure on equities. Oil prices continued to decline, with Brent crude futures down over 2% at $103.43.