Tech shares lift Wall Street's upward trajectory
On Wall Street, tech stocks are causing a frenzy as investors eagerly invest at the start of the week, with two indices reaching new record highs. The Federal Reserve's recent remarks on interest rates have minimal impact.
Wall Street recouped its Friday losses, although those betting on two rate cuts this year are disappointed as market yields rise. Investors remain unfazed and aggressively buy tech stocks, disregarding the upcoming release of retail sales and industrial production data on Tuesday.
The US Federal Reserve's rate cut proposal is confirmed by Neel Kashkari, President of the Fed's Minneapolis branch, who predicts a delay until December. Similarly, the President of the Philadelphia Fed, Patrick Harker, expects only one rate cut this year.
The Dow Jones Index increased by 0.5 percent to 38,779 points, the S&P-500 rose by 0.8 percent to a new all-time high. Goldman Sachs raised its year-end target for the S&P-500 from 5,200 to 5,600 points. The Nasdaq Composite climbed around 1 percent and also marked a new record high. There were 1,620 winners compared to 755 losers on Friday, with 65 unchanged titles.
Business activity in the New York region remains slow, but the Empire State Manufacturing Index for June rose more than expected. The data provided little impetus. The probability of a first rate cut in September was around 66 percent, about 2 percentage points lower than on Friday. "The Fed may not have to cut rates this year, but if they do, it will be bullish for stocks - especially for tech stocks," says James Demmert, Chief Market Strategist at Main Street Research, considering the high valuations on the stock market as "reasonable."
Yields rise slightly
In line with the central bank statements, yields on the bond market increased, although they had recently fallen significantly. With the improved data from New York, yields edged up a bit further. The increased investor risk appetite and strong stock market gains reduced the appeal of "safe havens," it was reported. The dollar also weakened as it was less sought after as a safe haven currency.
With rising market yields, the gold price dropped. Oil prices, however, rose significantly, according to reports from trading, but this was primarily due to technical reasons.
Autodesk saw a 6.5% increase, following a push from hedge fund Starboard Value for changes in the Design Software manufacturer. The chip and software manufacturer Broadcom (+5.4%) also saw an upward movement, registering its seventh consecutive increase after announcing a 1:10 stock split.
Best Buy gained 4.6%, following an upgrade from UBS to "Buy" for the electronics retailer. Louisiana-Pacific saw a 3.5% decrease after being downgraded by Goldman Sachs to "Sell."
The meme stock Gamestop fell 12.1% in value. The annual meeting, which was postponed last week due to a technical issue and resumed on Monday, was described as brisk, with CEO Mark Robinson giving little consideration to investor questions and ending the Q&A session quickly.
More information about today's stock market developments can be found here.
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Wall Street's tech stocks continue to attract investors, with the sector contributing to the sustained upward momentum, despite the Federal Reserve's muted comments on interest rates. Traders on Wall Street are buying tech stocks aggressively, disregarding impending economic data releases.
The upward trajectory of the technology sector on Wall Street extends beyond the major indices, with several tech companies experiencing significant gains, such as Autodesk and Broadcom.
