Chip stocks and major tech companies saw a strong boost on Monday, continuing a positive trend from the previous session. This rise suggests that worries about an AI bubble might be easing. Notable gainers included Advanced Micro Devices and Micron, with Tesla and Google’s parent company, Alphabet, rising by over 5%. This surge helped the Nasdaq composite index jump nearly 2%.
Market optimism was fueled by renewed hopes of an interest rate cut by the Federal Reserve next month. Boston Fed President Susan Collins mentioned she doesn’t see a pressing need for a rate cut. However, following comments from her New York counterpart, John Williams, who hinted at a possible “near-term” reduction, expectations have climbed. Fed governor Christopher Waller also reiterated calls for a rate cut soon.
Interestingly, interest rate futures reflect this optimism, showing over a 75% chance for a reduction—up from about 40% before Williams spoke and 71% on Friday.
On a global scale, European defense stocks dropped after the White House announced progress in peace talks with Ukraine. This was evident as natural gas futures in Europe also fell.
Meanwhile, Bitcoin traded around $86,000, experiencing its worst weekly loss since February just last week. In Asia, Alibaba’s stock improved, boosting the Hang Seng Index in Hong Kong while Japan’s markets remained closed for a holiday.
These market movements highlight the ongoing shifts in investor sentiment and the significant impact of central bank decisions on global markets. Keeping an eye on these trends is essential for understanding the broader economic landscape.
For further insights on market trends, you can refer to resources such as the Federal Reserve’s official announcements and significant financial news platforms.
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