The S&P 500 index experienced a minor increase of 0.16% in the latest trading session, though it lost momentum by the end of the day. The index currently stands at 5832, and the path toward 6000 still seems open.
In after-hours trading, Google (NASDAQ:GOOGL) reported strong earnings on both the top and bottom lines, driving a positive market response. Expectations are generally optimistic for this earnings season, with the tech sector anticipated to lead the recovery into year-end.
However, not all companies met investor expectations. AMD (NASDAQ:AMD) reported its earnings last night, disappointing with a conservative forecast for the upcoming quarter, resulting in a more than 7% decline in after-hours trading. Despite the dip, this presents an opportunity to invest in AMD at a potentially favorable entry point, as many believe the stock could recover.
Nvidia (NASDAQ:NVDA) also maintains a strong upward trend, breaking past the $140 mark. With earnings scheduled for late November, the current target stands at around $190, reflecting optimism for continued strength across the tech sector. Tesla (NASDAQ:TSLA), while reporting robust earnings, has met resistance at $170. The long-term outlook still suggests potential growth to $420, with market sentiment largely remaining optimistic about its future.
Broader Market and Global Trends
Safe-haven assets such as U.S. bond yields and gold prices are casting shadows over market optimism. According to a recent World Gold Council report, demand for gold surged last quarter, reaching a record high of over $100 billion. Speculators, national governments, and central banks are all vying for the asset, though there has been a slight slowdown in central bank purchases due to soaring prices. Gold recently crossed the $2,750 mark and is on track to reach $2,800 or higher, continuing an eight-month rally that shows no sign of slowing.
U.S. Election Dynamics and Market Movements
With only a week left until the U.S. elections, this event looms large for investors. The upcoming releases of several key economic indicators – including GDP, the Federal Reserve’s preferred inflation metric, the PCE, and the employment report – make this a uniquely data-intensive week. Amid earnings reports from tech giants like Google, Meta (NASDAQ:META), Microsoft (NASDAQ:MSFT), Amazon (NASDAQ:AMZN), and Apple (NASDAQ:AAPL), the elections are likely to dominate market sentiment.
Trump’s lead in current polls has stirred reactions in the market; for example, Bitcoin is on the verge of a rally, potentially reaching the $90,000 to $120,000 range, as investors view it as a safe haven amid uncertainty. Trump garners economic support largely due to perceptions of his business acumen and strict domestic budget policies. However, the bond market remains unpredictable, with yields not responding as expected to declining inflation. Additional economic contradictions persist, such as falling oil prices not prompting bond market rallies or yield declines.
Weekly Outlook
This week is set to be critical, with economic data releases in both the U.S. and Europe, alongside key earnings from tech giants. Markets are increasingly pricing in a “soft landing” for the U.S. economy, where inflation cools to the Fed's 2% target without a severe impact on economic growth. However, the upcoming economic data will challenge this assumption. Should inflation figures align with expectations while employment falls short, it could underscore the cost of the inflation fight. However, given the upcoming elections, dramatic market moves are unlikely despite the data-heavy week.