Background on Key Players and Context
The Nasdaq closed at an all-time high on Friday, driven by Microsoft’s strong performance. Investors were anticipating the upcoming Reserve Federal meeting where they expect interest rate cuts to counteract a slowing job market.
Tech giants like Microsoft and Tesla have been influential in the recent market movements. Microsoft’s stock surged after it avoided a potential EU anti-monopoly fine by offering reduced prices for its Office products, excluding Teams. Meanwhile, Tesla’s shares rose after the company’s board chair, Robyn Denholm, dismissed concerns that CEO Elon Musk’s political activities might have negatively affected Tesla’s vehicle sales, stating that Musk remains “at the forefront” of the company following his months-long White House engagements.
Market Performance and Key Indicators
On Thursday, market momentum was fueled by Tesla and Micron Technology stock rallies. The Nasdaq continued its upward trend on Friday, thanks to technology stocks.
Market participants had already predicted a 25 basis points relaxation in monetary policy following several indicators showing a worse-than-expected labor market. However, the dismal August nonfarm payrolls report increased expectations to a 50 basis points cut, currently sitting at 7.5% according to the CME’s FedWatch tool.
Following inflation data, market prices now reflect expectations of three quarter-point reductions—one in each remaining Fed meeting this year.
The preliminary University of Michigan Consumer Sentiment Index for September came in at 55.4, below the Reuters surveyed economists’ estimate of 58.
Market Index Closings
- S&P 500: Lost 3.47 points, or 0.05%, to close at 6,584.00.
- Nasdaq Composite: Gained 96.38 points, or 0.44%, to close at 22,139.46.
- Dow Jones: Fell 273.44 points, or 0.59%, to close at 45,834.56.
All three indices reported weekly gains.
Impact of Specific Company Performances
Microsoft’s stock surge contributed to the Nasdaq’s record high, while Tesla’s rise further bolstered the tech-heavy index.
Goldman Sachs and Sherwin-Williams’ declines kept the Dow Jones in negative territory despite weekly gains for all indices.
Key Questions and Answers
- Q: Who are the key players mentioned in this article? A: The key players include Microsoft, Tesla, and the Federal Reserve.
- Q: Why is Microsoft relevant in this context? A: Microsoft’s stock surged after it avoided a potential EU anti-monopoly fine, contributing to the Nasdaq’s record high.
- Q: How did Tesla’s performance affect the market? A: Tesla’s shares rose after its board chair dismissed concerns about CEO Elon Musk’s political activities, further supporting the tech-heavy Nasdaq index.
- Q: What caused the Dow Jones to fall despite weekly gains? A: Declines in Goldman Sachs and Sherwin-Williams stocks kept the Dow Jones in negative territory, despite all indices reporting weekly gains.
