A volatile week on Wall Street concluded with mixed outcomes across major indices . While tech stocks continued their upward trajectory, concerns in the banking sector and increased regulatory scrutiny of the cryptocurrency market weighed on broader market sentiment.
Tech Stocks Drive Nasdaq Higher
The Nasdaq 100 closed higher, driven by strong performances from tech giants like Tesla and Nvidia. Tesla’s impressive earnings earlier in the week put the company back in the spotlight,with its stock closing at a new high for the year.
Banking Sector Drags Down the S&P 500 and Dow
In contrast, the S&P 500 and Dow Jones Industrial Average finished the day lower, largely due to weakness in the banking sector.
New York Community Bancorp plunged over 8% after issuing a weaker-than-expected outlook. Other major banks like Goldman Sachs and JPMorgan Chase also experienced declines. The KBW Bank Index dropped 1.4%.
Cryptocurrency Market Faces Regulatory Pressure
The cryptocurrency market faced headwinds as Bitcoin plummeted following reports indicated that federal investigators are probing Tether for potential sanctions and anti-money laundering violations. This development added to the regulatory uncertainty surrounding the crypto industry.
Treasury Yields and Oil Prices Rise
Treasury 10-year yields increased by three basis points to 4.24%, while oil prices climbed as traders monitored escalating risks in the Middle East and other potentially pivotal factors in the market.
Weekly Performance Summary
For the week:
- S&P 500 declined by -1.0%
- Dow Jones dropped by -2.7%
- Nasdaq Composite gained +0.2%
Friday’s Closing Levels
| Index | Close | Change | % Change |
| Dow Jones | 42,114.40 | -259.96 | -0.61% |
| S&P 500 | 5,808.12 | -1.74 | -0.03% |
| Nasdaq Comp | 18,518.61 | +103.12 | +0.56% |
| US 10-Year | 4.24% | ||
| VIX | 20.33 | +1.25 | +6.55% |
Earnings Season and Upcoming Market Drivers
As earnings season progresses, investors are closely watching corporate earnings reports and economic indicators to gauge the market’s future direction. The upcoming US presidential election and the Federal Reserve’s monetary policy decisions are also anticipated to play significant roles in influencing market sentiment.
Next week, five of the “Magnificent Seven” tech giants will report earnings: Alphabet Inc., Meta Platforms Inc., Amazon, Apple, and Microsoft are all expected to post strong results.
Geopolitical Tensions Add to Volatility
In addition to earnings reports, geopolitical risks are rising. Israeli attacks on Iran over the weekend could contribute to increased market volatility in the coming week.
Market Outlook: Bulls Remain in Control, but Pullback Possible
Despite last week’s minor setback with the S&P 500 closing lower, the overall trend remains positive and is expected to hold up through the election period.
The selling pressure near the close on Friday is a bit concerning, but any potential pullback will likely be met with dip-buying. Although September and October didn’t bring the typical seasonal selloffs, November could see increased volatility post-election.
Bearish predictions have repeatedly been countered by new highs, leaving short-sellers in a difficult position. The market may only see a meaningful selloff when the last bear turns bullish—a sentiment that could be approaching.
Source: CBOE, Bloomberg
