On Monday, S&P futures experienced an uptick as market endeavored to stabilize following a week during which enthusiasm for the artificial intelligence sector diminished. The S&P 500 experienced increases of 0.6%. Futures associated with the Dow Jones Industrial Average increased by 214 points. Nasdaq-100 experienced increases of 0.7%. Oracle shares experienced an increase of over 1% in the premarket, whereas Nvidia saw a rise of 0.7%.
The S&P 500 experienced a decline last week as vulnerabilities emerged in a fundamental support of the bull market rally – the excitement surrounding the development of artificial intelligence. Nvidia’s remarkable $100 billion partnership with OpenAI has elicited investor skepticism regarding the sustainability of the business model. The S&P 500 experienced a decline of 0.3% last week, marking its most significant weekly downturn since August 1, and currently stands 0.8% below its all-time peak. The Nasdaq experienced a decline of 0.7%, marking its lowest point since early August. The Dow experienced a decline of 0.2%, marking its initial setback in a three-week period.
“The narrative shifted modestly last week in a negative direction as investors questioned two key assumptions underpinning the rally, the sustainability of the AI infrastructure boom and the inevitability of an aggressive Fed easing cycle,” Adam Crisafulli stated. Weekly jobless claims reported a figure below expectations on Thursday, while the second-quarter GDP was adjusted upward to 3.8%. The robust data has raised apprehensions that the Federal Reserve might delay rate cuts, jeopardizing a crucial driver for the bulls.
The upcoming September nonfarm payrolls report, scheduled for release on Friday morning, is capturing significant attention. Market may require another “goldilocks” figure to sustain the bull market — one that is neither too robust to provoke a hawkish response from policymakers nor too weak to signal a significant downturn. The market remains positioned for moderate advancements throughout September. The S&P 500 has experienced an increase of 2.8% this month, in contrast to the Dow, which has risen by 1.5%. The tech-heavy Nasdaq has exhibited notable performance, achieving a rally of 2.9%.