US stocks wrapped up a strong week, with all three major indexes recording their biggest weekly gains of 2024. The Nasdaq 100 (orange line) led the charge, surging 2.75% for the week, while the Dow Jones (blue line)and S&P 500 (red line) rose 1.78% and 1.94%, respectively.
This bullish run came on the heels of the Federal Reserve’s policy meeting on Wednesday. The Fed left interest rates unchanged but reiterated its dovish stance, reaffirming its plan for three rate cuts by year’s end. This dovish signal was music to investors’ ears, fuelling optimism and sending stocks rallying.
Beyond the Fed’s message, enthusiasm for artificial intelligence (AI) continued to power the tech sector, with the semiconductor index experiencing a sharp weekly rise. This reflects the ongoing excitement surrounding AI advancements.
However, Friday’s trading session saw a slight pullback, with the Dow and S&P dipping slightly and the Nasdaq edging higher. This could be a sign of profit-taking after the week’s strong gains or a potential pause before the next leg up.
Looking ahead, some analysts anticipate a potential correction or sideways movement in the near future, given the recent market highs. Nevertheless, the positive sentiment from the Fed and strong sectoral performances provide a solid foundation for continued growth in the US stock market.
Sources: TradingView, Trading Economics, Reuters, CNN, MarketScreener, Bloomberg.
Piece written by Mfanafuthi Mhlongo, Trive Financial Market Analyst
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