On Tuesday, the Nasdaq outpaced its Wall Street counterparts, bolstered by strong gains in major technology stocks. Alphabet (GOOGL), the parent company of Google, saw a remarkable 4.7% jump, propelling the communication services sector to an all-time high. Despite these gains, broader markets faced pressure, with nine of the 11 S&P sectors declining. Utilities led the losses with a 1.2% drop.
At 9:37 a.m. ET, the Dow Jones Industrial Average dropped 0.33%, while the S&P 500 remained almost unchanged. On the other hand, the Nasdaq Composite gained 0.42%, reflecting the strength of tech stocks.
Focus on Upcoming Inflation Data and Fed Interest Rate Decision
All eyes are on the November Consumer Price Index (CPI) report, which is set to be released on Wednesday. This key inflation data is expected to influence the Federal Reserve's interest rate decision at its upcoming meeting on December 17-18. Market expectations indicate a more than 86% chance of the Fed cutting rates by 0.25% next week, following a stronger-than-expected employment report last Friday. However, some analysts predict the Fed may pause its easing cycle in January, as a resilient economy is prompting central bank officials to slow down the pace of rate cuts.
John Belton, portfolio manager at Gabelli Funds, commented, "We expect CPI data to be consistent with recent trends, showing inflation heading toward the Fed's target, albeit with some fluctuations."
U.S. Stocks Surge Ahead of Year-End
U.S. stocks began the year-end rally on a positive note, with the S&P 500 and Nasdaq posting gains in their first week, building on the momentum from a strong November. The potential policies of President-elect Donald Trump, including tax cuts and deregulation, are fueling optimism about future corporate performance.
Notable Stock Movements: Oracle, MongoDB, Alaska Airlines, and Boeing
Among notable stock movements:
- Oracle (ORCL) fell 9.1% after reporting weaker-than-expected Q2 earnings.
- MongoDB (MDB) dropped 8.6%, despite raising its full-year revenue guidance.
- Alaska Airlines (ALK) surged 11.5% after increasing its Q4 profit forecast.
- Boeing (BA) rose 2.8% following reports that it resumed production of its 737 MAX jets.
Stay updated on market trends and the latest stock news as investors await the CPI report and Federal Reserve's decision on interest rates.
Source: Reuters.com
