To begin with, Morgan Stanley took a pivotal step by upgrading Tesla's rating from "neutral" to "overweight." Experts claim that Tesla's supercomputer, Dojo, developed by the company, could significantly increase Tesla's market value, adding nearly $600 billion to its capitalization.
However, Tesla is not the only player on this stage. Other mega-cap giants have also made their moves upwards. Amazon's shares (AMZN.O) rose by 3.5%, and Microsoft (MSFT.O) added 1.1% to its value.
Meta Platforms (META.O) did not stay behind either, rising by 3.25% after announcing the development of a more powerful artificial intelligence system for social networks.
Walt Disney (DIS.N) and Charter Communications (CHTR.O) also got their share of this positive momentum. After reaching an agreement to bring Disney programs, including ESPN, to the Spectrum cable service, Walt Disney's shares gained 1.2%, while Charter Communications' shares jumped by 3.2% just hours before Monday Night Football games began.
However, amidst all these favorable news, investors are awaiting inflation data. The information to be published on Wednesday will help gauge how close the Federal Reserve is to completing its interest rate hike campaign. Thursday will bring producer price data as well.
A survey conducted by the Federal Reserve Bank of New York has shown that Americans are still concerned about rising prices of housing and groceries. Despite this, their expectations regarding their own financial stability remain largely unchanged.
On Wall Street, there is currently an atmosphere of positive sentiment, driven by expectations regarding inflation and producer prices. Greg Bassuk, CEO of AXS Investments in New York, emphasizes that "we see that the likely indicators of the Consumer Price Index and producer prices will be more moderate." He even predicts that if the inflation data in August stays within expectations, the Federal Reserve (Fed) may refrain from further interest rate hikes.
However, it is worth noting that against the backdrop of recent oil price increases and strong economic data that exceeded expectations, Wall Street experienced some losses. This has heightened concerns about the sustainability of inflation and the possibility that high interest rates may remain elevated for an extended period.
According to the CME FedWatch Tool, traders believe there is a 93% probability that the Fed will leave interest rates unchanged at its September meeting, with a 57% probability of a pause in November.
Currently, Federal Reserve officials have entered a quiet period, which they typically observe before making policy decisions, this time until September 20th.
Meanwhile, the S&P 500 index continues to show strong growth, closing at 4487.46 points with a gain of 0.67%.
Amid market fluctuations, the Nasdaq and Dow Jones indices exhibited different dynamics, adding 1.14% to 13,917.89 points and 0.25% to 34,663.72 points, respectively. Trading volume was below average at 9.3 billion shares, compared to the usual average of 10.0 billion shares over the past 20 sessions.
Of the 11 sectoral indices in the S&P 500, nine showed gains, with consumer discretionary indices leading the way, up by 2.77%, and communication services indices rising by 1.17%.
Qualcomm (QCOM.O) saw its stock rise by 3.9% after reaching a new agreement with Apple (AAPL.O) for 5G chip supplies for the iPhone, paving the way through 2026.
Hostess Brands (TWNK.O) also had a notable performance, gaining 19.1% after J.M. Smucker (SJM.N) announced its acquisition of the Twinkies maker for $5.6 billion.
In the S&P 500 market, the number of advancing issues exceeded declining issues by a ratio of 1.5 to 1.
The S&P 500 index set 14 new highs and 11 new lows, while the Nasdaq recorded 36 new highs and 199 new lows.
The CBOE Volatility Index, which tracks S&P 500 options, decreased by 0.29%, reaching 13.80.
In the commodities market, December gold futures rose by 0.14%, reaching $1,000 per troy ounce. WTI crude oil futures for October delivery fell by 0.26% to $87.28 per barrel, while Brent crude oil futures for November delivery dropped by 0.07% to $90.59 per barrel.
In the Forex market, the EUR/USD pair increased by 0.48%, reaching 1.08, while the USD/JPY quotes fell by 0.87%, dropping to 146.52.
USD index futures fell by 0.52%, reaching 104.16.
