S&P ends volatile August with 4th straight winning month

Published On Aug 30, 2024, 4:06 PM

U.S. stocks ended a busy week and turbulent month positively, fueled by a favorable inflation report that boosted expectations for Federal Reserve rate cuts in September. The Dow Jones rose 0.6%, the S&P 500 increased by 1%, and the Nasdaq Composite gained 1.1%. The Personal Consumption Expenditures (PCE) index showed core inflation remained stable at 2.6% annually, keeping the Fed on a path for policy easing. Despite mixed performances among major tech stocks, Wall Street is transitioning away from recession fears and is optimistic about potential economic resilience and Fed actions.

Stock Forecasts

Given the optimistic sentiment around Fed rate cuts and ongoing investments in AI by major tech players, there is potential for stock prices to rise. The PCE data suggests a stable inflation environment conducive to lower interest rates, which could stimulate market activity.

The mixed results from Nvidia and concerns regarding the tech sector's profitability could weigh on investor sentiment, particularly in the short term. With tech giants struggling to show significant returns on AI investments, we might expect some volatility in tech stocks, including Nvidia.

Dell's positive earnings and increased demand for AI-related products could position it favorably, suggesting a buying opportunity for investors.

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