Tech Stocks Drive Nasdaq to Historic Highs
On Friday, the Nasdaq closed at record-breaking highs, driven by tech giants like Microsoft. Investors are anticipating the upcoming Federal Reserve meeting, where they expect interest rate cuts to counter a slowing job market.
- Market Performance:
- S&P 500: -0.05% to 6,584.29 points
- Nasdaq Composite: +0.44% to 22,141.10 units
- Dow Jones: -0.59% to 45,834.22 points
- Weekly Performance:
- Nasdaq: 2.03% increase
- S&P 500: 1.59% increase
- Dow Jones: 0.95% increase
On Thursday, market momentum was fueled by Tesla and Micron Technology’s stock surge. Friday saw the Nasdaq rise again, thanks to tech stocks.
Anticipation of Fed’s Monetary Policy Meeting
Investors predicted a 25 basis points relaxation in monetary policy after recent indicators showed a worse-than-expected labor market. However, the dismal nonfarm payrolls for August increased expectations to a 50 basis points cut, currently at 7.5%, according to the FedWatch tool by CME.
Following inflation data, market prices now reflect expectations of three quarter-point cuts—one in each remaining Fed meeting this year.
The preliminary consumer sentiment index for September, from the University of Michigan, came in at 55.4, below the estimated 58 by Reuters surveyed economists.
Microsoft’s Stock Gains
Microsoft shares rose after the tech giant avoided a potential EU anti-monopoly fine by offering reduced product prices to customers, excluding Teams.
Mexican Stock Market Hits New Highs
The Mexican stock market closed higher on Friday, mirroring a positive trend that led to record-breaking sessions throughout the week.
- S&P/BMV IPC: +0.40% to 61,798.94 points
- FTSE-BIVA: +0.43% to 1,235.75 points
The IPC reached its seventh record high in the last nine sessions, while FTSE-BIVA marked its fifth record during the same period.
Reactions to Mexico’s New Tariffs
Despite initial reactions, including warnings from the China-Mexico Chamber of Commerce and Technology regarding negative consequences for key industries and product supply chains, Mexico announced tariffs of up to 50% on countries without free trade agreements.
China, representing less than 2% of Mexico’s exports and 20% of its imports, has a trade deficit with the Asian giant. China provided 1.9% of Mexico’s foreign direct investment in 2024.
Key Questions and Answers
- Q: What drove the Nasdaq to new highs?
- Q: What are investors expecting from the upcoming Fed meeting?
- Q: How did the Mexican stock market perform this week?
- Q: What were the reactions to Mexico’s new tariffs?
A: Tech stocks, particularly Microsoft, led the Nasdaq to reach record-breaking highs on Friday.
A: Investors anticipate interest rate cuts to counter a slowing job market.
A: The Mexican stock market closed higher throughout the week, with both the S&P/BMV IPC and FTSE-BIVA reaching new highs.
A: The China-Mexico Chamber of Commerce and Technology warned of negative consequences for key industries and product supply chains, while China expressed potential retaliation.
