Weekly Stock Market Update & SPY Technical Analysis Markets roared back last week as traders bet on a holiday rally fueled by optimism around an interest rate cut in December. According to CME Group, the chances of a rate cut have surged to 86.4% following the most updated economic data, which is seen favorable by markets to fuel business and consumer spending. The Federal Reserve meeting and rate decision aren’t scheduled until December 10th, so until then, our focus will be on further economic data. For this week in specific, here are the key reports we’re watching: S&P final U.S. manufacturing PMI (Mon) ADP employment data (Wed) Initial jobless claims (Thu) U.S. trade deficit (Thu) PCE index / inflation data...
Weekly Stock Market Update & SPY Technical Analysis The AI boom continued to face scrutiny last week as many tout technology stocks’ valuations and question whether or not AI spending will actually pay off. Markets closed the week lower, with high growth technology stocks leading the way down, extending the sell-off that started weeks ago. Were Nvidia’s earnings not enough?Nvidia’s earnings report was certainly enough to spark some confidence back in markets, but shortly after the report’s bullish influence, investors began to take profits as other worries surfaced (We’ll get to those in a bit). But as for Nvidia, the company reported record revenue of $57 billion for the quarter, marking a 62.5% increase from the same period last year....
Weekly Market Update & SPY Technical Analysis November has been a wild ride for the stock market so far, with technology and innovation stocks feeling the burn as investors run for the exists in fears of overextended valuations. But it’s not all bad, other parts of the market are beginning to see an uptick in activity, specifically the healthcare and oil industries. Investors should welcome this capital rotation as it helps alleviate the technology sector and begins moving capital to underperforming parts of the market. What’s been happening? Only a handful of mega-cap stocks have been doing the heavy lifting for this market, pushing the major indexes to record highs. Nvidia alone now makes up roughly 8% of the S&P...
Weekly Stock Market Update & SPY Technical Analysis Artificial intelligence valuation concerns grew last week after the infamous “Big Short” Michael Burry revealed a position against Nvidia and Palantir. Burry famously called the 2008 crash and made billions, so anytime he screams “bubble,” the world tends to listen. However the decline in the market came from a combination of things, not just Burry’s crystal ball. The ongoing government shutdown, uncertainty around economic data and labor market, and the worry that The Fed won’t cut rates again this yea are all leaving investors more anxious than calm. Michael Burry’s position just triggered a pullback that was already in the making, and in reality, we don’t know when his position expires, and...
Weekly Market Update & SPY Technical Analysis The market got what it wanted last week, but the reaction was mixed. What do we mean by that? For one, large cap tech stocks reported record earnings, which is one of the two primary drivers of markets in the long run. The second primary driver is the interest rate, which was also lowered by The Fed last week. So, with record earnings and lower interest rates now official, why didn’t markets take off? As for earnings, investors seem to be concerned about artificial intelligence spending and how it’s weighing on profits. Yes, names like Meta, Apple, Microsoft, and Amazon all reported strong revenues, but they also all reported significant AI infrastructure spending,...
