Wall Street concluded a volatile week with a subdued session, as investors weighed the recent market rally ahead of the Federal Reserve's upcoming decision and the commencement of big-tech earnings reports.
The S&P 500 experienced its first consecutive weekly losses since June, although it recovered from Friday's decline, buoyed by robust consumer sentiment and gains in the majority of megacap stocks. Nvidia Corp. shares rose by 1.5% following reports that Chinese tech companies are permitted to prepare orders for H200 AI chips. Conversely, Intel Corp. stock plummeted 17% due to a disappointing outlook. Small-cap stocks underperformed the broader US equity benchmark, ending a 14-day streak of outperformance.
The S&P 500's two-week slide reflects investor caution amid ongoing economic uncertainty and anticipation surrounding the Fed's monetary policy stance. The technology sector, a significant driver of market gains in recent months, exhibited mixed performance, highlighting the sensitivity of tech stocks to regulatory developments and company-specific news.
Nvidia's advance underscores the continued demand for AI chips, particularly from China, despite ongoing trade tensions. Intel's decline signals potential challenges in the competitive landscape, as the company faces pressure to maintain market share and profitability. The underperformance of small caps suggests a potential shift in investor sentiment, with a preference for larger, more established companies during periods of market volatility.
Looking ahead, market participants will closely monitor the Federal Reserve's announcements and the earnings reports from major technology companies for further insights into the economic outlook and corporate performance. These factors are expected to play a crucial role in shaping market direction in the coming weeks.
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