4:15pm: Tech leads rally
Tech stocks shone brighter on Monday to lead markets to a strong finish to kick off the week.
At 4pm, all three major incides had gained 1.2%, with the Dow closing at 40,830, the S&P 500 at 5,471 and the Nasdaq at 16,885 points.
2:35pm: Dollar heading weaker?
The US dollar is heading into the last few months of 2024 at a lower level compared to its average value for the year, analysts at UBS have noted.
This means there’s a chance the dollar could make a short-term recovery if the Federal Reserve only cuts interest rates by 0.25% on September 18 and resists calls to cut them more aggressively by 0.5%. However, a key advantage that helped support the dollar earlier this year, known as a "carry premium" (essentially the benefit of holding dollars), has been fading, which could weaken the dollar in the long run.
"With the market open to the possibility of 50bp rate cuts by the Fed in a way that is not replicated in the assessment of other major central banks, we suspect it would take a surprising reversal higher again in US inflation data to turn the underlying trend back in favour of the dollar," analysts wrote.
12:20pm: Tech, consumer stocks lead rebound
Markets were in rebound territory by midday Monday after the S&P 500's worst week since early 2023, with the S&P 500 rising over 1%, the Dow Jones up more than 500 points, and the Nasdaq gaining about 1%.
The market rebound was led by Industrials, Financials, and Consumer Discretionary stocks.
Attention is now on upcoming consumer and producer inflation reports, which will influence the Federal Reserve's policy decision on September 18, while Apple's annual iPhone event, featuring the anticipated iPhone 16 and updates on AI features, is also a key highlight for the week.
11:15am: Calmer mood
A "calmer" mood has prevailed across stock markets after last week's selloff, according to IG's Chris Beauchamp.
“Friday’s selloff has seen countered by a wave of buying from investors, while the VIX has dropped back sharply," Beauchamp commented.
"The drop in the chances of a 50bps rate hike suggests that a calmer attitude prevails among investors, despite the slew of weaker jobs data from the US. Much now hangs on the CPI report, especially since Friday’s payroll report failed to provide much new information on the US economy.”
9.55am: Chip stocks on the move
The Nasdaq 100 surged a full percentage point when US markets opened on Monday, which has served to claw back last week’s substantial losses for the tech-focused index.
Arm Holdings PLC (NASDAQ:ARM) shot to the top of the movers table with a 4.3% gain. This comes as Apple Inc (NASDAQ:AAPL, ETR:APC) prepares to unveil its latest iPhone 16 model, which incorporates Arm’s latest chip designs.
Fellow chipmakers Marvell, Nvidia, Qualcomm and Texas Instruments were also well bid in early trades.
The Dow Jones Industrial Average is up 0.75% and the broader S&P 500 index has moved 0.9% higher.
8.30am: Stock market to move higher
The Dow Jones Industrial Average is expected to add 0.6% the trading commences on Monday, which should help to offset a bruising previous week.
The broader S&P 500 index is also set to open 0.6% higher, while the tech-focused Nasdaq 100 is tipped to open 0.7% higher, per pre-market futures contracts.
Nasdaq has a steep hill ahead if it hopes to recover the 5.5% worth of losses chalked up across the previous week.
The sell off was largely driven by tech stocks like Nvidia, which corrected by a walloping 13%.
On the macroeconomic calendar, wholesale inventories are forecast to add 0.3% month on month.
Apple Inc (NASDAQ:AAPL, ETR:APC)’s hotly anticipated unveiling of the new iPhone 16 handset will be the point of focus on the company news front.
Key to the latest launch, set for 10am Pacific, 1pm Eastern and 6pm British summer time, will be how AI software, dubbed Apple Intelligence, fits in with these new products.
These included a ChatGPT-powered version of speech recognition software Siri, AI-enabled writing tools and image-generating technology.