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US Stocks Soar as Tech Megacaps Lead the Way with Nvidia Surging 7%: Market Update

Technology Stocks Rally Lifts Market, Nvidia Climbs 7% After Selloff

The world’s largest technology companies experienced a rally that lifted stocks, with Nvidia Corp. leading the charge with a 7% climb following a $430 billion selloff. This surge in tech stocks, dubbed the “Magnificent Seven” cohort of megacaps, extended gains in the equities market for the month of June.

Amidst this upward trend, Treasury yields remained steady after a two-year US sale met expectations, signaling good demand. However, US consumer confidence saw a slight dip due to a more subdued outlook on business conditions, the job market, and incomes.

Federal Reserve officials commented on the inflation outlook, with Governor Michelle Bowman noting upside risks and her colleague Lisa Cook suggesting a potential rate reduction in the future. Despite some volatility expected in the market, analysts like Chris Zaccarelli at Independent Advisor Alliance believe the bull market will continue unless there are significant changes in the economy or Fed policy.

The S&P 500 rose to around 5,470, with the Nasdaq 100 climbing 1.2%. Companies like Carnival Corp. saw significant gains, while transportation stocks are set to face a crucial test with FedEx Corp. reporting earnings later in the week.

In the midst of all this, Nvidia’s recent selloff was reassured by UBS as not indicative of a broader market trend. UBS Chief Investment Officer Solita Marcelli emphasized that the correction in Nvidia should not be seen as a warning sign for the tech sector or the overall equity outlook.

Overall, investors are keeping a close eye on the market as the Fed moves closer to reducing interest rates. Societe Generale SA predicts an easing cycle beginning in early 2025, with expectations for continued growth in US stocks. The week ahead will bring key economic data releases, including US new home sales and Eurozone economic confidence, which will further shape market sentiment.

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