The Nasdaq Composite reached a record high on Monday, driven by strong gains in the tech sector as investors focused on the Federal Reserve’s final policy meeting of the year. By the close of trading, the Nasdaq rose 1.1% to finish at 20,173.74. The S&P 500 managed a modest gain of 0.4%, while the Dow Jones Industrial Average slipped by 0.3%.
Broadcom was one of the standout performers, jumping over 10%. The chipmaker’s strong quarterly earnings last week have fueled optimism, pushing its market value up by more than $300 billion since Thursday. Tesla also hit a new record high as the electric vehicle giant continues to benefit from post-election market momentum. The company’s market cap has now reached around $1.45 trillion after Wedbush Securities raised its price target to $515 and predicted it could climb to $650 by the end of next year.
Meanwhile, Ford saw its stock drop 4% after Jefferies downgraded it to “underperform,” citing concerns over excess inventory. Capri Holdings gained 4% following reports that the company is exploring potential sales of its Versace and Jimmy Choo brands. Barclays is reportedly helping manage the process, though no final decision has been made on whether the brands will be sold together or separately. Honeywell climbed more than 3% after announcing it is considering spinning off its aerospace division under pressure from activist investors. MicroStrategy initially gained but ended the day flat after being included in the Nasdaq 100 index.
Investors are now looking ahead to the Federal Reserve’s two-day policy meeting, which ends on Wednesday. The central bank is widely expected to lower interest rates by 25 basis points as part of its ongoing easing cycle. By the end of 2024, rates are expected to be reduced by a total of 100 basis points. However, the focus will be on the Fed’s guidance for 2025, as analysts anticipate a slower pace of rate cuts next year. Persistent inflation and a strong labor market could influence the central bank’s decisions moving forward.
Market data indicates a nearly 80% chance that the Fed will keep interest rates unchanged in January. Investors will also monitor upcoming economic data, including preliminary S&P Global PMI readings, for further signs of the economy’s strength.
