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Stock Market News for Aug 24, 2023

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Wall Street ended sharply higher on Wednesday, buoyed by positive mood in the technology sector. The 10-year treasury yield came down from a 16-year high. All three major indexes ended in the green.

 

How Did the Benchmarks Perform?

The Dow Jones Industrial Average (DJI) rose 0.5% or 184.15 points to close at 34,472.98. Twenty-two components of the 30-stock index ended in positive territory, one remained unchanged, while seven ended in negative.

The S&P 500 added 1.1%, or 48.46 points, to close at 4,436.01. Ten out of the 11 broad sectors of the benchmark index ended in positive territory. The Technology Select Sector SPDR (XLK), the Communication Services Select Sector SPDR (XLC) and the Real Estate Select Sector SPDR (XLRE) proceeded 1.8%, 1.6% and 1.5%, respectively, while the Energy Select Sector SPDR (XLE) lost 0.3%.

The tech-heavy Nasdaq gained 1.6%, or 215.16 points to close at 13,721.03.

The fear-gauge CBOE Volatility Index (VIX) was down 5.8% at 15.98. Advancers outnumbered decliners on the NYSE by a 3.74-to-1 ratio. On the Nasdaq, a 2.07-to-1 ratio favored advancing issues.

Expectations About NVIDIA’s Earnings Drive the Market

Upbeat speculations about how NVIDIA Corporation (NVDA - Free Report) would fare in its second-quarter earnings call drove the market on Wednesday. NVIDIA has emerged as one of the success stories of the year, with its share price rising 220% and market cap touching the $1 trillion mark. Throughout the day, positive vibes about the numbers it is going to present and the fuel it will add to the AI boom boosted investor mood. NVDA’s stock rose 3.2%. The technology sector rode on this mood in general.

10-Year Treasury Yield Comes Down From 16-Year High

The benchmark 10-year treasury yield closed at 4.198% on Wednesday, easing from the near 16-year highs it had hit on Tuesday. The yields fell following weak business activity data from the United States and the euro zone.

Usually, when long-term treasury yields fall, mega-cap growth stocks make the most of the situation. Their current valuation seems lucrative, and their prospects are bright. Technology stocks are an example of such mega-cap growth stocks and became the biggest gainers of the day. Investors, however, eagerly await Fed Chair Jerome Powell’s Friday Speech, for direction about the Fed’s policies going forward.

Consequently, shares of Apple Inc. (AAPL - Free Report) and Microsoft Corporation (MSFT - Free Report) gained 2.2% and 1.4%, respectively. Both carry a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks #1 Rank stocks here.

Economic Data

Per a government report, for the week ending Aug 18, 2023, U.S. commercial crude oil inventories (excluding those in the Strategic Petroleum Reserve) decreased by 6.1 million barrels from the previous week.

The U.S. Census Bureau and the U.S. Department of Housing and Urban Development jointly reported that for July, new home sales had increased to 714,000, against a consensus of 702,000 for the period. For June, the previously reported 697,000 was revised down to 684,000 new homes.


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