The Dow Jones Industrial Average and other key U.S. stock indexes opened higher on Monday as investors awaited a crucial Federal Reserve meeting later this week. Super Micro Computer (SMCI) emerged as a significant early loser, plunging after being removed from the Nasdaq 100 index. At the market open, the Dow Jones Industrial Average posted a 0.1% gain, with the S&P 500 up 0.2% and the tech-heavy Nasdaq Composite climbing 0.4%. Meanwhile, the yield on the 10-year Treasury dropped slightly to 4.37%, and West Texas Intermediate crude oil traded lower at $70.85 per barrel.
Exchange-traded funds also reflected the upbeat sentiment. The Invesco QQQ Trust (QQQ), tracking the Nasdaq 100, rose 0.4%, while the SPDR S&P 500 ETF (SPY) gained 0.3%. Late Friday, Nasdaq announced significant changes to its marquee Nasdaq 100 index, set to take effect on Dec. 23. Palantir Technologies (PLTR), MicroStrategy (MSTR), and Axon Enterprise (AXON) will join the index, replacing Moderna (MRNA), Illumina (ILMN), and Super Micro.
The news impacted early trading, with Palantir sliding 2.7%, Axon dropping 3.9%, and MicroStrategy surging 3.7%. Among the outgoing members, Moderna climbed 4.5%, Illumina rose 1.9%, and Super Micro trimmed its losses to 6% after initially dropping further. Super Micro also announced it had engaged Evercore for capital-raising efforts. Investor focus remains on the Federal Reserve’s two-day meeting, set to conclude Wednesday.
Recent inflation data, including the Consumer Price Index and Producer Price Index for November, has cemented expectations of a quarter-point interest rate cut. However, questions remain over the Fed’s projections for 2025. Market participants will scrutinize the central bank’s new quarterly forecasts, which are expected to indicate only modest additional rate cuts, likely bringing rates to a range of 3.75% to 4% next year.
Adding to the week’s data-heavy agenda, November retail sales figures, scheduled for release Tuesday, are forecast to show a 0.4% rise overall and a 0.5% increase excluding auto sales, according to FactSet estimates. Later in the week, the Fed’s preferred inflation gauge the core Personal Consumption Expenditures (PCE) price index will also provide crucial insights into price pressures.
Amid these developments, tech investors are monitoring cracks in Nvidia’s (NVDA) dominance in the artificial intelligence sector, while major players such as Alphabet (GOOGL), Broadcom (AVGO), and Credo Technology (CRDO) remain in focus for their market leadership. As the Fed prepares to set the tone for 2025, this week’s developments could provide critical signals for the direction of the economy and financial markets. – By EuroWire News Desk.
