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S&P 500, Dow hit record highs

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BofA expects Fed to go for 75-bp cut in Q4

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US big banks rise after Fed's jumbo rate cut

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Weekly jobless claims stand at 219,000

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Indexes up: Dow 1.03%, S&P 500 1.73%, Nasdaq 2.78%

(Updated at 11:49 a.m. ET/1549 GMT)

By Johann M Cherian and Purvi Agarwal

Sept 19 (Reuters) -

Wall Street's main indexes soared on Thursday with the S&P

500 and the Dow hitting intraday record highs after the Federal

Reserve kicked off its monetary easing cycle with

half-a-percentage point reduction and forecast more interest

rate cuts were on the horizon.

Rate-sensitive growth stocks that have led much of this

year's gains climbed, with top players such as Microsoft ( MSFT )

adding 1.9%, Tesla gaining 7.1% and Apple ( AAPL )

advancing 3.4%.

Semiconductor stocks such as Nvidia ( NVDA ) jumped

5.3%, while Advanced Micro Devices ( AMD ) gained 6% and

Broadcom ( AVGO ) added 4.7%, sending the Philadelphia SE

Semiconductor Index up 4.8%.

The Russell 2000 index, which tracks small caps,

also trended 1.8% higher with the broader market, as a lower

interest environment boosted prospects of lower operating costs

and greater profits.

At 11:49 a.m. the Dow Jones Industrial Average

rose 428.60 points, or 1.03%, to 41,931.70, the S&P 500

gained 97.47 points, or 1.73%, to 5,715.73 and the Nasdaq

Composite gained 488.76 points, or 2.78%, to 18,062.06.

Eight out of the 11 S&P 500 sectors gained, led by tech

stocks with a 3.4% rise, while defensive sectors like

utilities and consumer staples trended

lower.

After delivering its super-sized verdict on Wednesday, the

Fed forecast rates to fall by another 50 bps in 2024, and

unveiled macroeconomic projections that analysts say reflect

steady growth and lower unemployment.

"Markets are acting well to yesterday's messaging from the

Fed. They wanted to hear we weren't falling into recession which

Chair Powell reassured that the economy is on good footing,"

said Bret Kenwell, investment analyst at eToro.

"A soft landing is still in play; that's still the

default expectation. However, there's still clearly some concern

that the labor market is going from a period of softness to

weakness."

Data showed jobless claims for the week ended Sept. 14

dropped to a four-month low,

pointing to solid job growth

in September.

Traders now see a 61.1% chance that the central bank will

lower interest rates by 25 basis points at its November meeting,

as per the CME Group's FedWatch tool.

BofA Global Research now anticipates a total of 75 bps rate

cuts by the end of this year, compared with 50 bps forecast

earlier.

Evercore ISI data going back to 1970 showed the S&P 500 has

posted an average 14% gain in the six months following the first

reduction of a rate-cutting cycle.

September has generally been a disappointing month for U.S.

equities with the S&P 500 notching an average loss of 1.2% since

1928, but has gained over 1% so far this month.

The broader banks index trended 2% higher,

pulled up by big banks such as Citigroup ( C/PN ) and Bank of

America ( BAC ) after they lowered their respective prime rates.

Among individual movers, fertility benefits management

firm Progyny ( PGNY ) plunged 30% after a significant client

notified the company it had elected to exercise a 90-day option

to terminate its services agreement.

Advancing issues outnumbered decliners by a 4.04-to-1

ratio on the NYSE and by a 3.88-to-1 ratio on the Nasdaq.

The S&P 500 posted 51 new 52-week highs and no new lows,

while the Nasdaq Composite recorded 134 new highs and 47 new

lows.