Stocks Pause as Fed Looms, Nvidia and Apple Falter

Investors are treading cautiously ahead of the Federal Reserve's two-day policy meeting, with Dow Jones futures, S&P 500 futures, and Nasdaq 100 futures showing little change. Meanwhile, tech giants Nvidia and Apple have experienced notable declines, raising concerns among market participants.

Navigating the Uncertain Terrain: Stocks Await Fed's Next Move

Anticipation Builds as Fed Meeting Commences

The Federal Reserve's two-day policy meeting, which kicks off on Tuesday, is the primary focus for investors as they await the central bank's decision on interest rates. The Fed is widely expected to announce its first rate cut since slashing its key rate to near-zero in March 2020 during the onset of the COVID-19 pandemic. This highly anticipated move by the Fed is likely to have a significant impact on the broader market sentiment and investment strategies.

Retail Sales Report and Earnings Season in Focus

Alongside the Fed meeting, investors will also be closely monitoring the release of the August U.S. retail sales report on Tuesday. This economic data point will provide valuable insights into the health of the consumer sector, which is a crucial driver of the overall economy. Additionally, the earnings season is set to continue this week, with FedEx, Darden Restaurants, and homebuilder Lennar among the companies scheduled to report their financial results.

Nvidia and Apple Stumble, Raising Concerns

In the tech sector, two industry heavyweights have experienced notable declines. Nvidia, a member of the "Magnificent Seven" stocks, has fallen below its 50-day moving average, raising the possibility of a need for further consolidation. Similarly, Apple, another tech titan, has also broken below its 50-day moving average, with its relative strength line starting to flag. These developments in the tech space are likely to be closely watched by investors as they assess the broader market trends.

Dow Jones Components and Notable Stocks in Focus

Despite the mixed performance in the tech sector, the broader market has shown some resilience. On Monday, the Dow Jones Industrial Average reached a new all-time high, marking its 27th record close of 2024. Among the notable Dow Jones components, Amazon, Apple, Home Depot, and Microsoft have been garnering attention. Outside the Dow, retail giant Costco, food delivery service DoorDash, and semiconductor manufacturer Taiwan Semiconductor Manufacturing are also in the spotlight as they navigate their respective buy zones.

Magnificent Seven Stocks: Alphabet and Tesla

Turning to the "Magnificent Seven" stocks, Alphabet (Google's parent company) and Tesla have exhibited mixed performance. Alphabet has managed to close slightly above its 200-day moving average, indicating a potential rebound, while Tesla has experienced a 1.5% decline, snapping a five-day winning streak. Investors will be closely monitoring the movements of these high-profile stocks as they navigate the current market conditions.

Dow Jones Leaders: Amazon and Microsoft

Among the Dow Jones components within the "Magnificent Seven" group, Amazon and Microsoft have shown signs of strength. Amazon has reclaimed its 50-day moving average and is forming a new base, while Microsoft has also moved back above its 50-day line and is building a new base amid a six-day winning streak. These developments in the tech giants' stock prices are likely to be closely watched by investors as they assess the broader market trends.