The major U.S. index futures indicate a higher opening on Monday, suggesting that stocks may recover some of the losses experienced last Friday. Investors might consider acquiring equities at relatively lower valuations following the decline observed last Friday, primarily driven by a sell-off in the technology sector. Overall trading activity appears to be relatively subdued, as market participants anticipate the forthcoming release of significant U.S. economic data in the days ahead. The monthly jobs report for November, along with a report on retail sales for October, is set to be released on Tuesday, while a report on consumer price inflation for November is scheduled for Thursday. The data may influence the perspective on interest rates in the wake of the Federal Reserve’s monetary policy announcement last Wednesday. While the Fed reduced rates by another quarter point as anticipated, officials’ projections revealed notable divergences in views regarding additional rate cuts.
In the wake of the varied outcomes observed in Thursday’s trading session, equities experienced a notable decline during Friday’s market activity. The major averages experienced a decline, with the technology-focused Nasdaq registering a notably sharp decrease. The major averages concluded the day above their lowest points of the session, yet remained in negative territory. The Nasdaq experienced a decline of 398.69 points, representing a decrease of 1.7 percent, settling at 23,195.17, while the S&P 500 fell by 73.59 points, or 1.1 percent, closing at 6,827.41. The narrower Dow experienced a more subdued decline, decreasing by 245.96 points or 0.5 percent to 48,458.05 after achieving a new record intraday high earlier in the session.
For the week, the major averages exhibited a varied performance, with the Dow increasing by 1.1 percent, while the S&P 500 decreased by 0.6 percent and the Nasdaq fell by 1.6 percent. The decline observed was accompanied by a sell-off in technology stocks, as evidenced by the downturn in the Nasdaq. Broadcom helped lead the tech sector lower, plunging by more than 11 percent despite delivering fiscal fourth-quarter results that exceeded expectations and offering positive guidance for the upcoming quarter. Tech stocks such as Micron Technology, Oracle, Advanced Micro Devices, and Nvidia experienced significant declines, indicating an ongoing shift away from technology equities.
Negative sentiment may have been influenced by remarks from Chicago Federal Reserve President Austan Goolsbee regarding his rationale for opposing a reduction in interest rates during the previous week’s Fed meeting. In a recent post on the Chicago Fed website, Goolsbee expressed concerns about “too heavily front-loading rate cuts and just assuming that inflation will be transitory.” He stated that while he voted to lower rates at the September and October meetings, he believed policymakers should have waited to gather more data, particularly on inflation. Computer hardware stocks exhibited some of the market’s most significant declines, with the NYSE Arca Computer Hardware Index falling 5.2 percent, while the semiconductor and networking sectors also declined sharply. Beyond technology, weakness was seen in oil service, brokerage, and steel stocks, while pharmaceutical stocks showed relative strength.