Stock rally spreads as tech bounce gains momentum

The expectation of a rate cut from the Federal Reserve is likely to boost overall market sentiment, as it often signals a more favorable environment for equities. Small cap stocks in particular could benefit the most from policy easing.

Nvidia's recent gains in the chip sector highlight its strength, particularly leading up to a favorable monetary environment. However, concerns linger due to Adobe's disappointing outlook, which could impact broader tech sentiment.

Given the positive retail performance and Kroger's raised guidance, consumer defensive stocks may see upward momentum as investors seek stability during potential economic fluctuations.

On the downside, Adobe's disappointing outlook could indicate challenges in the tech segment, potentially leading to cautious sentiment among investors in that space.