S&P 500 & Nasdaq broke their 3-week losing streak
Both the S&P 500 & Nasdaq Composite ended Friday on a solid note, overcoming a morning dip in reaction to Fed chair Jerome Powell's remarks at Jackson Hole. Powell had indicated that the Federal Reserve was prepared to hike interest rates if needed.
Wall Street's major averages opened in the green, but then started to give up their gains during Powell's speech, before slipping into the red. They resumed a steady upward climb soon after through the rest of the day.
The tech-heavy Nasdaq Composite (COMP.IND) added 0.94% to close at 13,590.65 points. The benchmark S&P 500 (SP500) rose 0.67% to settle at 4,405.72 points, while the blue-chip Dow (DJI) advanced 0.73% to finish at 34,346.96 points.
All 11 S&P sectors ended in positive territory, led by Consumer Discretionary and Energy.
On a positive note, both the S&P 500 & Nasdaq Composite finally made a gain on the weekly candles, snapping a three week losing streak.
The Nasdaq Composite was up 2.26% for the week, while S&P 500 up 0.82% for the week. The Dow lost 0.45% for the week.
There were a few ways to make money, first was to head to a rural area with no internet service, and you couldnt access your stock trading platform. The other way was to do absolutely nothing and just go along with the ride, and by the end of the week you would have more money than you started on Monday.
Traders are currently pricing 80.5% of no hike in September, while 19.5% predict a 25 bp hike, according to the CME FedWatch Tool. Indeed the Federal Reserve is at the tail end of the rate hike cycle, and the market knows this.
But a higher for longer environment would make borrowing costs higher, as it is unlikely any rate cuts would be likely until middle of 2024. How do investors position themselves for this? Look for companies with solid revenues that have been increasing consistently for the past five years, net income and free cash flow increasing for five years, and companies with strong balance sheets with less debt. Avoid speculative companies that are not yet earning a profit, as these companies are often at an early growth stage and have a larger debt position.
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it is still too hard to forecast movement in the future in such climate
Index stock like this has worthy of long investment?