Stocks rose ahead of major central bank decisions, key economic data, and earnings from four megacaps worth nearly $10 trillion, setting the stage for a crucial week in the financial markets.
According to Bloomberg, almost 300 shares in the S&P 500 gained ground, with big tech leading the charge after a recent rotation that drove the Nasdaq 100 to the brink of a correction. Investors are eagerly awaiting results from Microsoft Corp., Meta Platforms Inc., Apple Inc., and Amazon.com Inc., which are expected to provide insight into the health of the tech sector.
Federal Reserve officials are also in focus, with expectations running high for a potential rate cut in the coming months. Fed Chair Jerome Powell is set to address the press on Wednesday, where he may provide clues about the central bank’s future monetary policy decisions.
“The Fed and tech earnings will have the spotlight for the week,” said Paul Nolte at Murphy & Sylvest Wealth Management. “The future direction of interest rates should be clearer after the press conference. Big tech can answer whether investors’ expectations for still high growth rates is warranted.”
Despite the positive sentiment in the market, small caps slipped while big tech stocks saw gains. The S&P 500 hovered near 5,465, with a gauge of the “Magnificent Seven” megacaps rising 1%. The Russell 2000 of smaller firms fell 1.1%, while Tesla Inc. jumped on a bullish call from Morgan Stanley.
In the bond market, Treasuries remained steady but were on track for a third straight month of gains, the longest run since 2021. Companies are rushing to raise cash in the debt markets ahead of the Fed decision, with the US cutting its estimate for federal borrowing for the quarter.
Overall, investors are closely watching central bank decisions in the US, Japan, and the UK, as well as key economic data releases throughout the week. The outcome of these events could have a significant impact on market sentiment and the direction of stock prices in the near term.
This story was produced with the assistance of Bloomberg Automation and contributions from Jeran Wittenstein, Ryan Vlastelica, Alexandra Semenova, and Sagarika Jaisinghani.
