Stock market in New York showing signs of continuous record-breaking performances leading up to the announcement of the US interest rate decision.
In the world of finance, several significant events have taken place today.
Alphabet, the parent company of Google, saw a 0.5 percent rise in pre-market trading, marking the first time its market capitalization surpassed the $3 trillion milestone.
Meanwhile, shares of Hershey rose 3.3 percent in pre-market trading following a double upgrade from US investment bank Goldman Sachs. The bank changed their recommendation from "Sell" to "Buy," citing positive outlooks for the chocolate giant.
US Treasury Secretary Steven Mnuchin announced a framework for a TikTok deal, with President Trump hinting at an agreement regarding the future of the popular short video app in the US. The expected agreement involves key figures such as US Treasury Secretary Scott Bessent, former President Donald Trump, Chinese Trade Representative Li Chenggang, and Wang Jingtao, deputy director of China's Cyberspace Administration. American partners are likely to include Oracle, and investors such as Andreessen Horowitz and Silver Lake.
The US retail sales rose more than expected in August, indicating a robust consumer confidence. However, in the S&P 500, losers have outweighed winners on most days recently. Shares of media conglomerate Warner Bros Discovery fell 1.9 percent due to a downgraded buy recommendation from TD Cowen.
Elsewhere, US President Donald Trump has filed a $1 billion defamation lawsuit against The New York Times and several of its journalists, with shares of the newspaper falling 2.5 percent in pre-market trading. Trump has also accused journalists of intentionally and maliciously defaming him in the run-up to the 2024 presidential election.
The Federal Reserve is expected to lower the benchmark interest rate by 25 basis points tomorrow. Before the decision, data on industrial production is also on the agenda. The focus is on the interest rate path, whether the Fed will embark on a continuous rate-cutting cycle or not.
In the tech sector, Tesla recovered by 0.9 percent in pre-market trading, and the Nasdaq Composite has seen great enthusiasm recently due to hopes for lower interest rates. However, experts from Index Radar referred to the Nasdaq as a "paper tiger." About half of the Nasdaq index members have been in the red since the start of the recent winning streak. Many speculative positions built up by investors would only be profitable if the Fed does not sound too restrictive.
Lastly, Elon Musk, CEO of Tesla, recently bought shares of the company worth around $1 billion. The Nasdaq's volatile nature and the anticipated Fed decision are set to shape the stock market's trajectory in the coming days.
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