U.S. stocks rose in the first session of the week, following the worst performance of the year experienced by Wall Street over the past five days, betting that the Fed’s rate cut next week will provide support to the slowing economy.
Technology stocks, which were among the hardest hit last week, were the biggest gainers today.
THE Dow Jones Index rose 484.18 points, or 1.2%, to close at 40,829.59 points, after losing more than 1,200 points the previous week. The S&P 500 posted gains of 1.6% to close at 5,471.05 points after losing more than 4% of its value in the previous week, in its worst performance since March 2023. This was the index’s first gain in four sessions of decline.
THE Nasdaq rose 1.16% to 16,884.60, after its worst weekly performance in more than two years, thanks to a 3.5% rise in Nvidia. The “favorite child” of artificial intelligence has lost 14% in the past week.
Outside of technology, retail, banking and industrials rallied strongly as investors believe a rate cut will boost consumer spending. JPMorgan Chase & Co, Costco, Amazon and Boeing Co were among the gainers in today’s session. Boeing Co also rallied more than 3% amid optimism that a wage deal with unions will prevent strikes.
Investors are awaiting U.S. consumer price data, which could give a better picture of the Federal Reserve’s decision at its September 18 meeting and its next steps. Investors are certain the Fed will cut interest rates, but opinions differ on how big the cut will be.
Elsewhere, Palantir and Dell Technologies rose 14% and 3.8%, respectively, after S&P Dow Jones Indices announced the two stocks would be admitted to the S&P 500.