In a mixed trading day on Wall Street, Oracle’s astonishing 36% surge in share price failed to bolster overall market confidence. While the S&P 500 managed a modest gain of 0.3%, the Nasdaq 100 remained virtually flat, and the Dow Jones experienced a decline of 0.48%, largely due to weak performances from tech stocks—barring Nvidia. Oracle’s meteoric rise, which added an impressive $242 billion to its market capitalization in just a single session, was driven by the company’s confirmation of heightened demand for its AI-related cloud services, bolstered by significant new orders. This surge momentarily pushed Oracle founder Larry Ellison ahead of Elon Musk in the global wealth rankings.
Despite Oracle’s prominence in the headlines, other tech giants experienced setbacks. Notably, Apple shares fell by 3% following the release of new products that consumers criticized for lacking innovative AI features. The broader sentiment in Europe mirrored this cautious tone, with most indexes declining, although France’s CAC 40 saw a slight increase of 0.15% without a clear catalyst.
Today’s focus shifts towards critical economic data. Investors are particularly keen on the U.S. inflation report set to be released at 8:30 a.m. ET, as it represents the final indicator that could shape Federal Reserve policy as they convene next week. Current predictions suggest a 92% probability of a 25 basis point rate cut, with only 8% of traders anticipating a 50 basis point cut. General forecasts estimate annual inflation at 2.9%, with the core inflation rate expected to be at 3.1%. Simultaneously, the European Central Bank (ECB) is anticipated to maintain its current interest rates, with its rate decision announcement also set for this morning.
In the Asia-Pacific region, the mood is mostly optimistic, especially in Japan, which saw a gain of 0.6%. Markets in mainland China and Taiwan are steady, though South Korea and India exhibit fragile gains, while Hong Kong and Australia’s markets are slightly down as participants adopt a wait-and-see approach ahead of the U.S. data release.
Key economic events affecting markets today include the announcement of Germany’s producer price index, ECB’s decision on interest rates, the U.S. consumer price index, new jobless claims, and the federal budget balance.
In corporate news, Alibaba has announced plans to raise $3.2 billion through a zero-coupon convertible bond sale to fund international expansion and enhance its cloud business. Boeing has reportedly reached a tentative agreement with the machinists’ union to conclude a five-week strike in the St. Louis area. Chipotle Mexican Grill is poised to expand into Asia, planning new restaurant openings in South Korea and Singapore, amidst a slowdown in U.S. consumer spending on dining out.
In legal developments, South Korean e-commerce firm Coupang successfully gained the dismissal of a lawsuit alleging fraud against shareholders connected to its 2021 IPO. Other notable market movement includes a reported 3% rise for firearms retailer Grabagun and a 3.3% gain for Outdoor Holding.
From an analyst perspective, various companies have received upgrades and downgrades. Truist Securities raised the price target on Affirm Holdings, while Guggenheim initiated coverage on Atlassian with a buy rating. Similarly, Deutsche Bank upgraded Chewy, and D.A. Davidson recommended buying Nvidia, raising its price target for the stock. Conversely, HSBC downgraded Lululemon Athletica and revised its price goal downward.
As the financial landscape continues to evolve, these developments are set to play a crucial role in steering investor sentiment and market movements in the coming days.
