Stock market rallies as tech stocks surge

Tech Surge
Tech Surge

The stock market rallied on Thursday, with the S&P 500 gaining 0.75% to close at 5,595.76, marking its fourth consecutive winning day. The Dow Jones Industrial Average added 235.06 points, or 0.58%, to end at 41,096.77, while the Nasdaq Composite gained 1%, closing at 17,569.68. Shares of megacap tech and semiconductor companies continued to rally, with Nvidia jumping 1.9% and Alphabet and Meta each gaining more than 2%.

The communication services sector advanced 1.7%, making it the biggest outperformer in the S&P 500, led by Warner Bros. Discovery’s 6.6% jump.

Inflation data released this week served as the final data points ahead of the Federal Reserve’s September 17-18 meeting, where central bankers are widely expected to announce a quarter-percentage-point interest rate cut.

The producer price index (PPI) for August aligned with expectations, following data released Wednesday indicating an uptick in core prices but also showing that inflation declined to its lowest level since February 2021.

Tech stocks driving market rally

Edward Jones senior investment strategist Mona Mahajan said, “Generally, folks are in wait-and-see mode ahead of the Fed next week.” She expects “cooling, but not collapsing” economic growth and believes that if the Fed is cutting rates and inflation is moderating gradually, markets should continue to perform well.

In other news, net worth for American households hit a fresh record of $163.8 trillion in the second quarter, a 1.7% increase bolstered by a big jump in real estate holdings. However, debt levels also rose, with total household debt moving higher by 3.2%, and federal government debt accelerating by 6.3%. Shares of Kroger rallied more than 4% after the supermarket chain reported mixed fiscal second-quarter results, while Petco shares soared 14%, building on Wednesday’s post-earnings rally of nearly 33%.

Moderna’s stock plummeted nearly 16% after announcing its cost-cutting plans. Despite the recent market turmoil and erratic price action, the S&P 500 and Nasdaq Composite are heading for their fourth weekly gain in five weeks, rising 3.5% and 5.3%, respectively. The Dow Jones Industrial Average has also gained 1.9% this week.

The S&P 500 appears poised to challenge the 5650-5670 resistance heading into next week’s Federal Reserve meeting and is now just 1.2% below its intraday record of 5,669.67, reached in July.

Harper Johnson

Harper Johnson stands at the forefront of digital marketing, where she dissects and interprets the impact of online advertising trends, social media dynamics, and search engine algorithms on consumer behavior.

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