U.S. stocks closed the week within striking distance of all-time highs, buoyed by renewed expectations that the Federal Reserve will begin cutting interest rates in September and a flurry of upbeat corporate and economic news.
The Dow Jones Industrial Average rose roughly 1% for the week, briefly touching a fresh intraday record on Friday before paring gains. The S&P 500 added about 1%, while the Nasdaq Composite advanced slightly less, held back by weakness in the semiconductor sector.
A sharp rally in UnitedHealth Group shares—sparked by news that Berkshire Hathaway had taken a sizable stake—was a standout driver, adding more than 200 points to the Dow on Friday alone. In contrast, chipmaker Applied Materials sank over 14% after issuing disappointing revenue guidance, dragging down the Philadelphia Semiconductor Index.
Economic data reinforced the view that the U.S. consumer remains resilient. The Commerce Department reported retail sales rose 0.5% in July, marking the third consecutive monthly gain and bolstering confidence in consumer-driven growth. The figures helped lift retail and consumer discretionary stocks, with Amazon gaining on news of expanded same-day grocery delivery services.
Despite the market’s buoyant tone, some analysts urged caution. Goldman Sachs strategists warned of “unfriendly asymmetry” in equity risk-reward, citing compressed volatility levels and stretched valuations. The firm advised clients to maintain hedges and a neutral tactical stance.
Globally, equity markets from Tokyo to London also posted gains, reflecting the easing inflation pressures and growing belief that central banks could soon pivot toward rate cuts.
The yield on the 10-year U.S. Treasury note edged lower to 3.86%, while oil prices ticked up modestly, supported by signs of firming demand.
For now, investor optimism appears intact—but with the S&P 500 trading near historic peaks, traders say the market’s next leg will likely hinge on the Fed’s messaging at its upcoming policy meeting.
By: Montana Newsroom staff
