S&P 500 nears all-time high as investors await Fed decision

US stocks surged on Friday, with the S&P 500 and Nasdaq Composite securing their strongest week of 2024, buoyed by anticipation for an upcoming Federal Reserve rate cut.

The S&P 500 climbed 0.54 per cent to close at 5,626.02, nearing its July all-time high. The tech-heavy Nasdaq Composite added 0.65 per cent, reaching 17,683.98. Both indexes extended their winning streak to five consecutive days. The Dow Jones Industrial Average jumped 297.01 points, or 0.72 per cent, to close at 41,393.78.

Utilities, communications services, and industrials led the market's sectors on Friday, with each sector gaining approximately 1 per cent. Health recorded the fewest gains.

Investors continued to accumulate shares of megacap tech and semiconductor companies, fueling this week's rebound rally after recent underperformance. Semiconductor powerhouses Super Micro Computer and Arm Holdings surged by 3.4 per cent and 5.9 per cent, respectively. Alphabet advanced 1.8 per cent, and Uber jumped over 6 per cent.

Moderna shares tumbled over 2 per cent after JPMorgan downgraded it to underweight, citing revised revenue forecasts. Oracle announced a boost to its fiscal 2026 revenue outlook and strong 2029 guidance. Aptiv PLC stock climbed nearly 3 per cent as CEO Kevin Clark snapped up 30,000 shares.

For the week, the S&P 500 rose 4 per cent, and the Nasdaq Composite gained 5.9 per cent, marking their best weekly performances of the year. The Dow advanced 2.6 per cent during the same period.

Wall Street is now focused on the Fed's policy meeting on September 17-18, where a 25-basis point interest rate cut is widely anticipated. The Fed's current target rate is between 5.25 per cent and 5.5 per cent.

Economic data signalling a moderation in inflation further supported the case for a rate cut. The consumer price index in August came in at 2.5 per cent on an annualised basis, the lowest level since February 2021. Wholesale prices rose 0.2 per cent in August, in line with expectations.

Futures

The SPI futures are pointing to a 0.2 per cent gain.

Currency

One Australian dollar at 7.30am was buying 67.05 US cents.

Commodities

Gold added 1.17 per cent. Silver jumped 3.21 per cent. Copper added 0.97 per cent. Oil lost 0.46 per cent.

Figures around the globe

European markets closed higher. London’s FTSE added 0.39 per cent, Frankfurt gained 0.98 per cent, and Paris closed 0.41 per cent higher.

Turning to Asian markets, Tokyo’s Nikkei lost 0.68 per cent, Hong Kong’s Hang Seng added 0.75 per cent, while China’s Shanghai Composite closed 0.48 per cent lower.

On Friday, the Australian share market closed 0.30 per cent higher at 8100.

Ex-dividends
Chorus Limited (ASX:CNU) is paying 22.1841 cents unfranked
Credit Corp Group (ASX:CCP) is paying 23 cents fully franked
Echelon Resources (ASX:ECH) is paying 1.275 cents unfranked
Qube Holdings Ltd (ASX:QUB) is paying 5.15 cents fully franked
Saunders Intl Ltd (ASX:SND) is paying 2.25 cents fully franked

Dividends payable
Computershare Ltd (ASX:CPU)
Mitchell Services Ltd (ASX:MSV)
Vicinity Centres (ASX:VCX)
Johns Lyng Group Ltd (ASX:JLG)
MyState Ltd (ASX:MYS)

Sources: Bloomberg, FactSet, IRESS, TradingView, UBS, Bourse Data, Trading Economics, CoinMarketCap, Marketech.

Disclaimer

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