S&P500 and Nasdaq near records

Optimism returned to US stock markets on Wednesday, primarily due to dovish statements from Fed officials. First, Neel Kashkari, president of the Fed in Minneapolis, stated that "the economy is slowing, which means it may be appropriate to begin an adjustment in the near term." In his opinion, two final rate cuts "seem reasonable" and may be necessary even if uncertainty about the impact of tariffs on inflation persists. Later on Wednesday, Lisa Cook of the Fed's board described the latest labor market data and its revision compared to previous months as "troubling." She stated that such data revisions "are typical of turning points." Yields on two-year US bonds, sensitive to a potential change in monetary policy, were falling. Yields on 10-year bonds rose slightly, which was due, among other things, to weak demand during Wednesday's auction of bonds with this maturity.

The most volatile companies were those that released quarterly results and forecasts before the market opened. Super Micro Computer saw the biggest decline in the S&P 500 (-19%). The AI server manufacturer, which collaborates closely with Nvidia, failed to achieve either expected profit or revenue. Advanced Micro Devices (-6.3%) was also among the most undervalued companies. Although its quarterly results were better than expected, investors were disappointed and concerned by the company's refusal to provide a sales forecast for AI chips specifically designed for the Chinese market. Overall, the artificial intelligence industry did not have a good day. The iShares Future AI & Tech ETF, which includes its representatives, ended the session down 0.2%. Meanwhile, the Technology Select Sector SPDR Fund rose 1.1%. One difference between these ETFs is the presence of Apple in the second, which was one of the fastest-growing companies on Wednesday in both the S&P 500 and the Dow Jones Industrial Average, as well as among the tech blue chips in the Magnificent Seven. Demand for the company's shares was fueled by the White House's announcement that President Donald Trump would announce a $100 billion investment in Apple's U.S. production on Wednesday. Investors interpreted this as a sign of diminishing risks stemming from the imposition of tariffs on India and China, where iPhones for the U.S. market are manufactured.

Wednesday's announcement that the US would face an additional 25 percent tariff on Indian imports due to purchases of Russian crude oil only temporarily boosted crude prices. At closing, crude fell for the fifth consecutive month, the longest decline since January. Brent fell 1.1 percent to $66.89, and WTI fell 1.2 percent to $64.35. Analysts emphasized that the additional tariff would only take effect in 21 days, but after its announcement, media reported that President Donald Trump planned to meet personally with Russian President Vladimir Putin next week, followed by a meeting between Trump, Putin, and Ukrainian President Volodymyr Zelensky.

Although the S&P 500 ended the session higher, 52% of the index's companies declined. Demand prevailed in six of its 11 major segments. The sharpest price increases were seen in discretionary consumer goods suppliers (2.5%), with Amazon.com (4.0%) and Tesla (3.6%) recording the largest price gains. Consumer goods suppliers (1.7%) and IT companies (1.3%) also outperformed the market. Healthcare companies (-1.5%) and energy and utilities (-0.9% each) fared the worst.

In the Dow Jones Industrial Average, 17 of the 30 companies rose. Besides Apple (5.1%), the fastest-growing stocks were Walmart (4.1%) and Amazon.com (4.0%). The biggest declines were recorded by Amgen (-5.1%) and Walt Disney Co. (-2.7%), which released quarterly reports before the market opened. Both reported better-than-expected earnings and revenues, but other metrics were more important to investors.

On the Nasdaq Composite, most of the nearly 3,300 companies fell, but the index's rise fueled demand for the most valuable companies. The "Magnificent Seven" index gained 1.9%, reaching a record high, surpassing 28,000 points for the first time. Apart from Microsoft (-0.5%), all blue-chip technology stocks rose, with Apple (5.1%), Amazon.com (4.0%), and Tesla (3.6%) gaining the most.