By
Godfrey Benjamin
April 26th, 2024
While all three major indexes rose, the S&P 500 hit a new record barely a week after setting a previous one.
The S&P 500 index climbed on Monday and hit a new record after cresting at 4,927.93, a 0.76% increase. This new record is a 0.69% increase from its previous January 25 record close of 4,894.16. The S&P 500’s jump comes as the general market anticipates details on earnings reports from several companies. The market is also expecting the Federal Reserve’s decision on interest rates after the meeting which ends tomorrow.
The rise in the S&P 500 is similar to increases seen in other indexes, including the Dow Jones Industrial Average and the Nasdaq Composite. While the DIJA closed at 38,333.45 after climbing 0.59% (adding 224.02 points), the Nasdaq recorded a bigger jump, rising 1.12% to close at 15,628.04.
FOMC Decision and Earnings Reports to Shape Stock Market
The Federal Open Market Committee (FOMC) will commence its policy meeting today. The two-day meeting should end with news of the apex institution’s decision on whether or not it will increase, reduce, or maintain the current interest rate. According to the CME FedWatch Tool, traders have set a 2.1% probability that the Fed will reduce rates to 5.00% – 5.25%. On the other hand, the tool shows a 97.9% probability that the Fed will maintain the current 5.25% – 5.50% rate.
In addition to expected news from the FOMC, investors are waiting on earnings reports from some of the biggest Wall Street companies. This week, several mega-cap tech companies should release their earnings figures and performances. Reports are expected from Apple Inc (NASDAQ: AAPL), Meta Platforms Inc (NASDAQ: META), Microsoft Corporation (NASDAQ: MSFT), Alphabet (NASDAQ: GOOGL), and Amazon.com Inc (NASDAQ: AMZN). Quarterly earnings from non-tech giants Merck & Co Inc (NYSE: MRK) and The Boeing Company (NYSE: BA) are also expected.
According to E-Trade’s Head of Trading and Investing, Chris Larkin, this week is important. Larkin said:
“If the market is going to sustain its latest breakout, it may need to avoid earnings disappointments from this week’s Big Tech lineup, get encouraging news from the Fed on interest rates, and see jobs numbers that are solid, but not too hot.”
iRobot Already Losing
While the market awaits earnings reports as indicators for the near future, vacuum-maker iRobot (NASDAQ: IRBT) is already grappling with a loss. The Roomba maker’s stock fell 10% in morning trading on news that Amazon will no longer pursue an acquisition. An official press release states that both parties mutually terminated the agreement because there is “no path to regulatory approval in the European Union.” The release adds that the companies have signed a termination agreement that resolves all related issues, including an application termination fee.
The acquisition was first announced in August 2022, expected to cost $1.7 billion. The plan was for Amazon to pursue a market share in consumer robotics after announcing the Astro home robot.
According to MarketWatch data, iRobot has lost 59.95% year-to-date (YTD), and nearly 66% in the last year. Over the last 5 days, the stock has plunged by about 11%.