A day after the Federal Reserve increased interest rates by 25 bps, investors jumped into technology stocks. The Nasdaq (QQQ) added 439.87 points to close up by 1.69%. The usual Magnificent 7 names led the charge. That included NVIDIA (NVDA), Microsoft (MSFT), Alphabet (GOOGL), Amazon (AMZN), and Tesla (TSLA).
Markets should not attribute the strong rally to the Fed. Instead, oil prices pulled back for a second straight day. That gave markets hope that diesel prices, along with WTI and Brent crude, would fall. Shares of Exxon Mobil (XOM) and Chevron (CVX) traded almost flat yesterday.
Risks
Diesel demand faces upward pressure as U.S. truckers start hauling agricultural products. So long as shipping volumes are constrained in the two Straits in the Middle East, energy prices will likely rise. Still, investors bought gold (GLD) and silver (SLV) ETFs. They also bought Treasury bonds, betting that the longer term 20+ year Treasury bill (TLT) bottomed in the low $80s.
Investors dumped debt- heavy firms. T-Mobile (TMUS) lost 5.57%, Comcast (CMCSA) fell by 3.46%, and Verizon Communications (VZ) dropped by 2.87%. Telus (TU) drifted to a multidecade low, compared to BCE, which erased August’s rally. Rogers Communications (RCI) broke below its 50-day moving average, closing at $35.12 (-2.17%).
