The S&P 500 index nearly erased its hard-earned gains. Meanwhile, the Nasdaq 100 saw a 1.5% drop, with tech giants Amazon and Nvidia leading the decline. This decline was compounded by reports from Taiwan Semiconductor Manufacturing Co. calling for delays in shipments of high-end equipment, leading to a 2.5% drop in the chipmakers’ shares.
The auto industry also experienced turbulence, exemplified by the fluctuations in the fortunes of Ford and General Motors due to an industry-wide strike. On the contrary, Apple emerged as a prominent player, with its recently launched iPhone 15 Pro generating immense pre-order interest.
Friday’s market saw the culmination of a $4 trillion options event, which contributed to higher volatility. This event coincided with the rebalancing of benchmark indices, which further influenced market dynamics. Analysts warn that these factors can culminate in significant market swings.
While inflation expectations in the United States experienced a decline, there was an increase in consumer confidence regarding the economic outlook. However, sentiment levels fell below the median estimate according to a Bloomberg survey. In a surprising turn, New York factory activity expanded unexpectedly, driven by a surge in new orders. However, factory production experienced only marginal growth, hampered by declining motor vehicle production.
Economists surveyed by Bloomberg News project that a robust U.S. economy will lead the Federal Reserve to consider raising interest rates further this year, keeping them at the peak level well into next year.
In terms of fund inflows, equity funds saw their most substantial weekly rise in 18 months, indicating growing investor confidence in a soft landing for the US economy. According to Bank of America Corp., global stocks attracted a staggering $25.3 billion in the week ending September 13, the largest inflow since March 2022.
Despite this optimism, strategist Michael Hartnett offers a broader bearish outlook. It underlines that cash and Treasuries have taken up the lion’s share of inflows, and both are headed for a record-breaking year.
Featured Corporate Developments:
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Charles Schwab Corp. reported a temporary drop in net new money, attributable to customer attrition during the TD Ameritrade integration.
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Adobe Inc.. met sales expectations but fell short of investors’ projections for revenue growth, driven by its artificial intelligence tools.
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Walt Disney Co.. filed at least one bid for its ABC TV network, local stations and select cable channels, signaling a strategic shift toward streaming.
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Discover financial services It is contemplating the possible sale of its student loan business as part of a broader initiative to streamline operations.
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instacartthe largest U.S. grocery delivery service, raised its price range for an imminent initial public offering following the stellar debut of chip designer Arm Holdings.
Market movements:
Foreign exchange market:
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Bloomberg Dollar Spot Index: No change
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Euro: +0.2% to $1.0668
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British pound: unchanged at $1.2397
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Japanese yen: -0.3% to 147.85 per dollar
Cryptocurrency market:
Bond market:
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10-year Treasury bond yield: +3 basis points to 4.32%
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German 10-year yield: +8 basis points to 2.67%
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UK 10-year yield: +7 basis points to 4.36%
Basic products:
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WTI crude oil: +0.1% to $90.27 a barrel
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Gold futures: +0.8% to $1,948.80 per ounce.
Also read: Automotive workers go on strike; Arm Holdings Stock Rises; Market stability continues