Week of 03/18-03/22 FED Keeps Interest Rates Steady, Reddit IPO Opens at $47

All three major indexes are on track to close with strong weekly gains to mark one of the best performing weeks for the stock market in 2024. Investor optimism fueled the stock market earlier this week after the FOMC meeting finalized on Wednesday, where Jerome Powell (Chair of the Federal Reserve) announced the decision to keep interest rates untouched. Powell reinforced that interest rate cuts are still in the FED's plans for 2024, with a forecast of three cuts later in the year. However, there is still a possibility of delaying changes in monetary policy if hot inflation readings from economic reports persist.

Reddit was the highlight of the stock market on Thursday, as the company's IPO debuted in the New York Stock Exchange under the ticker RDDT. The stock opened at $47 a share and reached a high of $57.50. RDDT closed at $50.44 and gave the company a market cap of approximately $9.5 billion.

Importance of Initial Public Offerings (IPOs).

Initial Public Offerings (IPOs) are the process by which a private company becomes publicly traded by selling its shares to the general public for the first time. In an IPO, the company hires investment banks to help determine its value, set the offer price, and facilitate the sale of shares to institutional investors and individual investors. IPOs provide an opportunity for companies to raise significant capital and expand their operations, as proceeds from the sale of shares are typically used for growth initiatives, debt reduction, or acquisitions. For investors, IPOs offer a chance to invest in early-stage companies and potentially profit from their growth. Publicly traded companies also provide liquidity, allowing investors to buy and sell shares easily. The significance of IPOs in the stock market lies in their ability to bring new and innovative companies to the public market, providing opportunities for investors to diversify their portfolios and participate in the potential growth of promising businesses. Moreover, IPOs can generate excitement and enthusiasm in the market, driving overall market sentiment and influencing investor behavior.