Nasdaq index ended the week with a new record, S&P 500 and Dow - in the negative

The Nasdaq Composite Technology Sector Index ended Friday's five-day series of closes at a record high. Investors are returning to technology stocks, having regarded the latest reports on the state of the US economy as evidence of the Fed's imminent rate cut. The situation with other U.S. market indices is not so clear: the S&P 500 closed trading in a symbolic minus of five hundredths of a percent, while the Dow Jones and Russell 2000 slipped 0.6-1%.

- The Nasdaq Composite rose 0.4% to a new high of 22,141.1 points at the end of trading on September 12. The index updated the record five consecutive closings. This is the longest consecutive series of growth since mid-July, writes Barron's. For the week, the index added 2%.

On Friday, the Nasdaq Composite was impacted by a 7.4% jump in Tesla shares after Tesla Chairman Robin Denholm said the board still supports CEO Elon Musk. According to Dow Jones Market Data, shares of the "Magnificent Seven," which includes Tesla, finished trading for the first time with a combined market capitalization of more than $20 trillion, The Wall Street Journal reported.

- The main index of the broad market S&P 500 closed trading on Friday with a symbolic decline - by 0.05%. At the end of the week, the index added 1.6%, showing the best dynamics since early August, notes CNBC. Five of the last six weeks S&P 500 ended in the plus.

- The blue-chip index Dow Jones Industrial Average fell 0.6% and closed trading at 45,834.2 points. Despite the pullback on Friday, the index rose 1% for the week, breaking a series of three weeks of decline. On Thursday, the Dow exceeded the 46,000-point mark for the first time.

- The Russell 2000 index of small-cap stocks fell 1% to 2,397 points on Friday, showing a one-point gain for the week.

- The dollar posted its biggest weekly drop in about a month, Bloomberg reported.

- In terms of the number of IPOs, this week was a record since 2021. Six companies raised a total of over $4 billion.

Investors are preparing for the Fed's rate decision, which will be announced on September 17. According to CME's FedWatch tool, a quarter percentage point decline in futures is almost certain. Economic data released this week supports that possibility, CNBC writes. The Consumer Price Index (CPI) for August came in slightly above expectations, but this traditionally important inflationary indicator was overshadowed by statistics on jobless claims, which unexpectedly rose to the highest level since October 2021. According to economists surveyed by Bloomberg News, the labor market crisis is likely to prompt the Fed to conduct a series of rate cuts starting next week.

"Right now, the market is priced based on a very favorable scenario: low volatility, moderate rate cuts are supporting the economy, corporate earnings look good," Cathie Jones, chief bond market strategist at Charles Schwab, told WSJ. - But of course, the risk remains that things could go the other way."

Macro data and downwardly revised job growth numbers from the Bureau of Labor Statistics further confirm a slowing labor market and that inflation remains under control - which "sets the stage for a rate cut next week," Bill Northey, chief investment officer at U.S. Bank Wealth Management, told CNBC.

"The Fed doesn't like to surprise markets, and as expectations of a 25 basis point cut have taken hold, we believe they will implement this decision," he said. - In the middle of next week we will have a very information-packed [central bank] meeting".

"The Fed is being pulled in different directions, with rising inflation on one side and a weak labor market on the other," Bill Adams of Comerica Bank said in a Bloomberg commentary. - We can expect the Fed to keep cutting rates in the coming months. The only question is how much.

"A rate cut is unlikely to come as a surprise to the market," said Oscar Munoz and Gennady Goldberg of TD Securities. - However, the likely unwillingness of Jerome Powell and members of the Federal Open Market Committee to lock in further rate easing could be perceived as a less soft stance."

This article was AI-translated and verified by a human editor