The stock rally for Big Tech companies on Monday helped Wall Street recover about 50% of its losses from the previous week. The S&P 500 increased by 29.97 points, or 0.7%, reaching 4,487.46. This was a welcome change after the market experienced its first losing week in the past three weeks. The Dow Jones Industrial Average also advanced, gaining 87.13 points, or 0.3%, closing at 34,663.72. Similarly, the Nasdaq composite saw an increase of 156.37 points, or 1.1%, ending the day at 13,917.89. Notable gainers included Tesla with a jump of 10.1%, Amazon with a climb of 3.5%, and Meta Platforms with a rise of 3.2%. Last week, tech stocks were leading the market decline as Treasury yields rose. On Monday, these yields remained relatively steady.
This week holds a crucial data point for the Federal Reserve’s decision on whether to further increase interest rates, aiming to bring inflation back to its target of 2%. On Wednesday, the US government will release the latest monthly update on consumer prices across the economy, with predictions indicating a 3.6% increase in August compared to the previous year, as reported by the AP. Additionally, economists at Deutsche Bank believe that a report on wholesale-level inflation, due on Thursday, is almost as important as the consumer-level data. They suggest that high wage growth in the healthcare industry may be a contributing factor to inflation. Another report on Thursday will provide insight into the spending habits of US households at retailers in the previous month.
On Wall Street, Charter Communications saw a 3.2% rise after announcing a deal with the Walt Disney Co. to restore access to ESPN and other channels for its Spectrum video customers. Disney’s stock also rose by 1.2%. Apple experienced a 0.7% increase leading up to its Tuesday event where the release of the latest iPhone model is anticipated. Aerospace company RTX, however, faced a 7.9% decline following the announcement of an issue with its Pratt & Whitney aircraft engines, potentially impacting operating profit by $3 billion to $3.5 billion over the next few years. On the other hand, Hostess Brands gained 19.1% after JM Smucker revealed plans to acquire the maker of Twinkies and HoHos in a cash-and-stock deal valued at $5.6 billion.
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