The market posted a mostly positive week, led by gains in the Nasdaq (+2.0%) and the S&P 500 (+1.6%), while the Dow Jones Industrial Average (+1.0%) and Russell 2000 finished with more modest results. The Russell 2000 (+0.3%) and S&P MidCap 400 (-0.4%) underperformed, highlighting the market’s reliance on mega-cap strength. The S&P 500 Equal Weight Index (+0.3%) lagged the market weighted index, further underscoring the influence of the largest components.
The technology sector (+3.1%) was the standout sector this week, fueled by strong moves in the mega-caps and strength in the semiconductor group. The Vanguard Mega Cap Growth ETF (+2.0%) reflected this dynamic, while the PHLX Semiconductor Index (+4.2%) climbed in response to AI-related enthusiasm and company-specific gains.
Oracle’s (+25.5%) remarkable mid-week surge following its report propelled the technology sector and created volatility across the “magnificent seven,” emphasizing the outsized influence of single company moves. Tesla (TSLA, +12.9%) and Broadcom (AVGO +7.5%) were among other notable mega-cap moves.
The week’s economic data mostly reinforced expectations that fed will begin to lower interest rates. While the August PPI print came in slightly hotter than expected (0.4% vs consensus of 0.3%), and Core CPI met expectations at 0.3%, a 27,000 spike in initial jobless claims to 263,000, their highest level since October 2021, bolstered the market’s current rate cut expectations through the end of the year.