There was a big rise in the market after the rise in stocks after the Fed’s decision.

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By journalsofus.com


The markets (^DJI, ^IXIC, ^GSPC) have put a positive cap on the trading week, with all three five-day moving averages closing in the green on Friday. Stocks rose Wednesday around the Federal Reserve’s latest monetary policy decision.

Yahoo Finance reporter Alexandra Canales joins the live show to highlight the biggest events impacting stocks, including economic and housing data prints and even the Justice Department’s lawsuit against iPhone maker Apple (AAPL). Antitrust lawsuit is also involved.

For more expert insights and the latest market action, click here to watch this full episode of Yahoo Finance Live.

Editor’s Note: Who was this article written by? luke carberry mogan,

video transcript

Julie Hyman: Let’s connect with Alexandra Canals, senior reporter at Yahoo Finance. Hey, Ellie.

Alexandra Canal: Oho.

Julie Hyman: So as we talked, it was Fed week. And it also has to do with how you were looking at the week.

Alexandra Canal: Yes, there were a lot of expectations going into this meeting, especially when it comes to those dot plots, right? Where will we see the Fed maintaining its estimate of three cuts this year? And I thought it was interesting because, Josh, you and I were talking to a friend of the show, Michael Antonelli, earlier this week. And he basically arrived at the belief that it doesn’t matter whether the Fed cuts once, twice, or maybe not at all, because the economy is so strong.

And I think what we got from the summary of economic projections really highlights that fact. Fed officials are considering that higher economic growth. He increased his revisions for GDP to 2.1%. That’s higher than the 1.4% that Fed officials had expected in their December estimate.

He also said that unemployment is going to fall to 4%. This is 4.1% less than their estimate. So it seemed like the Fed was pretty confident that we were going to get this soft landing narrative.

And when it comes to when they cut, it doesn’t matter if they cut because the economy still remains incredibly resilient. For example, you might look at something like existing home sales, which increased 9.5% in February compared to the previous month, homes which are a very interest rate-sensitive area of ​​the market. But they’re doing well, the market is still tight, inventory is high. Possible sign that we may have reached a low point there.

So I think the story here is that the economy is doing well and stocks are at record highs. Despite all this we still have very high interest rates. So as long as the economy remains resilient, it could take us into the soft landing camp.

Josh Lipton: Yeah, it was interesting because we were just talking to a strategist today and on the fundamentals, she was saying, I think she agreed that the economy is strong and that should boost corporate profits. The question is, how much are you willing to pay for it? And I think she was somewhat skeptical about that multiple.

Julie Hyman: Yes, definitely. Well, and speaking of the doubters of multipliers, we were talking about Mag Seven, the topic of the downside of goodbye or goodbye today was, interestingly, NVIDIA. So clearly, people are seeing some of these multiples, but particularly in the Mag Seven. Apple faced a tough challenge this week.

Alexandra Canal: Not a good, very bad week I’m calling Apple. I mean, that DOJ antitrust lawsuit wiped billions of dollars off the market capitalization. The stock closed down more than 4% on Thursday.

Today we have bounced back from those lows with the stock up by about half a percent. But I think it highlights the potential cracks in Mag Seven that we’ve been discussing and talking about, this extension of the rally. Apple isn’t alone in that camp. Tesla too.

We’ve heard from analysts that technology is a very crowded space and there could be room for potential downside this year. This is probably the issue you were discussing in your Good Bye or Goodbye play. And I think the fact that Microsoft has now overtaken Apple in market cap in that Mag Seven shows that Apple will continue to face these challenges.

And as we move deeper into this antitrust competition litigation, I think we could see further declines in some of these tech stock names. That being said, though, I think the technology will continue to show some resiliency. I mean, it was the only major index to close in the green today. And if you look at the sector action, communications services, technology and utilities are–

Julie Hyman: NVIDIA was on record again today. There is a group that did not perform well today.

Alexandra Canal: Yes.

Julie Hyman: And in short, athleisure about which we talked a little under some pressure.

Alexandra Canal: Yes, and it all has to come from guidance and perspective. And the interesting thing about Lululemon is that it is a very high-end consumer. But on the earnings call the CEO said they are seeing this change in consumer behavior potentially indicating some fatigue in terms of demand there.

And then on the Nike side, they’ve increased the competition. So I wonder if this could be the end of the athletic boom we’re seeing since COVID. Now, we’re a few years behind, but these results are certainly disappointing.

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