Dow Jones hits new high, S&P 500 regains momentum

During the trading session on November 11 (ending early morning of November 12, Vietnam time), the US stock market recorded some outstanding marks when optimism spread about the possibility of ending the US government shutdown, along with positive economic data. However, the technology sector continued to be under pressure due to concerns about high valuations, especially for stocks related to artificial intelligence (AI).

Cash flow shifts, US market stabilizes after week of decline, technology under pressure

The S&P 500 rose 0.2%, or 14.18 points, to 6,846.61, after erasing losses from the morning. Despite last week's first weekly loss in four weeks, the S&P 500 rebounded strongly on Monday and continued its upward momentum on Tuesday. However, the Dow Jones Industrial Average had a strong day, rising 559.33 points, or 1.2%, to a new record high of 47,927.96, surpassing its previous all-time high set just two weeks ago.

However, the Nasdaq composite index lagged behind the broader market, falling 0.3% (down 58.87 points) to 23,468.30 points, mainly due to the decline in Nvidia shares, amid concerns that AI-related stocks have become too expensive.

Leading the market in trading was Paramount Skydance, the entertainment company that posted a strong 9.8% gain after reporting earnings that missed Wall Street expectations. However, investors seemed optimistic that the company had raised its cost-cutting target to at least $3 billion, up from $2 billion. Despite the financial results missing expectations, the improvement in its cost-cutting strategy boosted the stock's growth.

FedEx followed, rising 5.4% after raising its current-quarter profit forecast. The company now expects holiday earnings to be higher than last year, rather than just picking up from the summer.

Not all stocks performed well, however. Nvidia, one of the most important stocks on Wall Street, fell 3% amid investor concerns about high valuations for AI stocks. Japanese tech giant SoftBank also said it sold its entire stake in Nvidia, netting $5.83 billion last month. While SoftBank continues to focus on AI, particularly OpenAI and ChatGPT, Nvidia's decline suggests investors are starting to be more cautious about the tech stock craze.

Meanwhile, CoreWeave, an AI-powered cloud platform company, fell 16.3% despite reporting better-than-expected financial results. However, investors were concerned about supply chain issues and delays in data center construction, which could impact CoreWeave's future revenue.

While the tech sector continues to struggle, the broader market has seen a return to stability. The November 11 session saw a clear shift in cash flow from tech stocks to stocks with stronger fundamentals and less affected by the tech cycle. This was most evident in the Dow Jones’s rise while the Nasdaq stagnated.

Companies with “value” fundamentals, such as health care and consumer staples, are attracting greater interest. Technology stocks in particular, while still in demand, are starting to be more cautious in assessing valuations and risks.

One important factor to watch is the macroeconomic situation. Data from Goldman Sachs showed that job growth slowed in October, leading traders to predict a possible interest rate cut at the next Federal Reserve meeting. These expectations, if realized, could provide a boost to the stock market.

However, investors still need to closely monitor factors such as the Fed's monetary policy, the employment situation and economic data from the US government . Continued government stagnation could lead to surprises, positive or negative, that have a big impact on the market.

The November 11 session was a clear sign of stability returning to the US stock market. Although the market did not explode strongly, there was a clear recovery, especially from stocks with strong fundamentals. Although concerns about high valuations of technology stocks remain, the record high of the Dow Jones and the shift of money to other sectors indicate a shift in investor sentiment. Macroeconomic factors and monetary policy will continue to be factors to closely monitor in the upcoming trading sessions.

Source: https://thoibaonganhang.vn/dow-jones-lap-dinh-moi-sp-500-lay-lai-da-tang-173430.html