Tech Earnings and Economic Data Halt Six-Week Stock Rally as Investors Reassess Market
Staff Editor US Stocks End Six-Week Rally as Tech Earnings and Economic Data Take Center Stage
U.S. stocks experienced a downturn this week, bringing an end to a six-week winning streak for the S&P 500 and Dow Jones Industrial Average. The market’s pause was largely attributed to rising bond yields and robust economic data, which prompted investors to reassess their positions.
The S&P 500 closed at 5,808.12, down 0.03%, while the Dow Jones Industrial Average fell 0.61% to 42,114.40. In contrast, the Nasdaq Composite managed to extend its gains for a seventh consecutive week, reaching a new record high of 18,518.61, up 0.56%.
A significant factor influencing market sentiment was the sharp increase in bond yields, with the 10-year U.S. Treasury yield climbing nearly 20 basis points. This surge posed challenges for investors, particularly in rate-sensitive sectors.
As the market takes a breather, attention is now shifting to upcoming tech earnings reports, with investors keenly focused on AI monetization trends. Major tech giants including Apple, Meta, Microsoft, and Amazon are set to release their quarterly results, which could provide crucial insights into the sector’s performance and future outlook.
The current earnings season has shown promise, with 36% of S&P 500 companies having reported so far. Of these, 79% have exceeded profit estimates, boasting a median beat of 6%. Additionally, 58% have surpassed revenue expectations, with a median beat of 2%.
Economic data continues to play a pivotal role in shaping market expectations. Investors are eagerly awaiting the release of September’s consumption expenditures and the October jobs report. The robust addition of 254,000 jobs in September has already influenced rate-cut expectations, adding another layer of complexity to the market landscape.
In commodities, West Texas Intermediate crude oil rose 2.19% to $71.73 a barrel, while Brent crude increased by 2.11% to $75.95 a barrel. Gold prices also saw a modest gain of 0.30%, reaching $2,757.10 an ounce.
The cryptocurrency market experienced some volatility, with Bitcoin decreasing by 1.83% to $66,914.
As the market navigates through these various factors, investors remain cautious yet attentive to emerging opportunities and potential risks in the evolving economic landscape.
