Indices Slip as Rate Questions Persist
The Dow Jones Industrial Average ended the week at 52,215.16, a gain of 0.41%. The Nasdaq Composite settled at 25,955.34, down 0.71%, and the S&P 500 Index finished at 7,623.68, a decline of 0.47%. All three remain above rising 52-week simple moving averages, which the report treats as evidence that the long-term uptrend is intact.[S1]
Federal Reserve policy dominates the outlook. The central bank lifted rates in September for the first time since 2023 in response to inflation running above target. FedWatch indicated an 88% likelihood that rates stay unchanged at Wednesday's meeting, while futures implied roughly an 80% chance of an increase in December. Traders will parse the decision and Chair Kevin Warsh's press conference for signals on that path.[S1]
Technology shares weakened after results from Meta and Lam Research fell short of investor expectations. Even so, third-quarter S&P 500 earnings are tracking a rise of more than 32% year over year, and capital spending by hyperscalers is projected at about $800 billion for the year.[S1]
Earnings Calendar Puts Big Tech in Focus
Alphabet is due to report on Wednesday, and analysts expect earnings of $3.00 per share on revenue of $127.9 billion, a 24.9% gain versus the prior year; results from search, YouTube and cloud will be closely watched. Microsoft also reports Wednesday, with a consensus estimate of $4.71 per share. Amazon reports Thursday, forecast at $1.96 per share on revenue of $202.2 billion, up 12.2%, as investors focus on profitability, capital spending and payoffs from AI investments.[S1]
Intel and Sandisk report Thursday, with estimates of $0.40 and $46.20 per share respectively. Caterpillar is expected to earn $7.03 per share, and Bernstein anticipates a beat on a healthy backlog while flagging softer bookings momentum. Eli Lilly is seen at $5.70, Mastercard at $5.17, and on Friday Chevron at $4.86 and Exxon Mobil at $4.10.[S1]
Earlier in the week, AstraZeneca and Verizon report Monday, followed Tuesday by Boeing, Coca-Cola, PayPal, UPS, Visa, NXP Semiconductor and Robinhood Markets. Wednesday also brings GE Vernova, Automatic Data Processing, Vertiv and ServiceNow.[S1]
Data Gauntlet and Technical Levels
Thursday carries the heaviest data load: advance GDP is forecast at 3.2% against a prior 2.2%, Core PCE month over month at 0.3% versus 0.2%, the advance GDP price index at 3.5% against 6.1%, jobless claims at 198K versus 194K, and personal income at 0.3% against 0.2%. Friday brings the employment cost index at 0.8% versus 0.9% and Chicago PMI at 54.8 versus 58.8.[S1]
On the charts, the Dow shows support at 50,546.54 and resistance at 52,645.44, 53,140.77 and 54,744.33. The Nasdaq has support at 25,894.95 and 25,802.96, with resistance at 26,074.05, 26,762.86 and 27,722.75. The S&P 500 lists support at 7,592.22, 7,541.19 and 7,507.77, and resistance at 7,844.52.[S1]
The report frames the week's central question as whether earnings and company guidance can sustain confidence in AI spending. Holding the cited support zones would keep the long-term uptrend alive, while disappointing results, hotter inflation readings or Fed remarks about December could put those levels under strain.[S1][S2]
