U.S. Stocks Rise Ahead of Key Decisions and Major Tech Earnings: The U.S. markets are experiencing significant anticipation ahead
of crucial decisions by the Federal Reserve and the announcement
of earnings data from four major technology companies valued at around $10 trillion.
These developments will significantly impact market trends and stock movements in the coming period.
Contents
Shift in Stock Preferences
Developments in Technology Companies
Shift in Stock Preferences
The shift in stock preferences has led the Nasdaq 100 index to the brink of correction,
with large tech stocks rising while small stocks fell after gaining up to 10% in July.
Investors await the earnings results of Microsoft, Meta Platforms, Apple, and Amazon,
which will be crucial in guiding the market after a disappointing start to the major companies’ earnings season.
Collective Stock Performance
The S&P 500 index stabilized near the 5,470-point level,
while large-cap companies’ “Magnificent Seven” index rose 1.4%.
Conversely, the Russell 2000 index of small companies fell by 1.3%.
Tesla’s stock surged after a positive recommendation from Morgan Stanley,
while McDonald’s shares declined despite a drop in sales as the company pledged to launch new promotions.
Interest Rate Expectations
It is widely expected that the Federal Reserve will keep interest rates unchanged next Wednesday.
However, investors see signs of a potential move in September,
with increasing risks from a weakening but still strong labor market.
Interest rate decisions in Japan and the United Kingdom will also be closely monitored.
Developments in Technology Companies
Experts noted that the dominance of a few technology companies this year is not related to Silicon Valley tech dreams
but rather to new developments and trends.
According to Bank of America analyses, S&P 500 companies that exceeded Wall Street estimates
The next day, in terms of sales and earnings, it outperformed the U.S. stock index by 2.4 percentage points.
Review of Corporate Earnings
The bleak expectations for U.S. corporate earnings negatively affect economy-linked stocks,
as investors worry about the impact of falling inflation on pricing power.
Michael Wilson from Morgan Stanley pointed out that a measure tracking earnings upgrades
versus downgrades has weakened, which is typical for this time of year.
Future Market Trends
After a robust first half of 2024, traders should temper their optimism about stock market gains in the coming months.
Data from SentimenTrader indicates that most key indicators have been in danger territory for 182 consecutive days,
nearing a level last seen during the meme stock frenzy in 2021.
Conclusion
Recent developments indicate that global markets are undergoing significant transformations,
which require investors and traders to monitor them continuously and make strategic decisions
based on precise analyses of economic data and major corporate earnings.
U.S. Stocks Rise Ahead of Key Decisions and Major Tech Earnings