• Nasdaq and S&P 500 open with strong gains as tech sector rallies, led by a remarkable 25% surge in Nvidia shares.
• Nvidia impresses with its earnings and revenue, surpassing expectations, and provides a robust revenue guidance driven by the growing demand for AI chips.
• Dow Jones experiences a decline of over 100 points as the looming debt ceiling impasse continues to weigh on investor sentiment, with Fitch Ratings putting the US on credit watch for a potential downgrade.
• House Speaker McCarthy offers a glimmer of hope, citing progress in negotiations and instructing his team to work round-the-clock towards reaching a deal on the debt ceiling.
• Fresh data reveals that the US economy grew more than initially estimated in the first quarter, reinforcing the need for additional rate hikes from the Federal Reserve, while jobless claims rise less than anticipated.
• The dollar index maintains its upward momentum, surging past 104 and reaching its highest level in over two months, driven by positive remarks from House Speaker McCarthy regarding progress in debt ceiling negotiations and the sovereign rating watch.
• Recent data demonstrates the resilience of the US economy despite the Federal Reserve’s aggressive tightening measures, with revised Q1 GDP growth outperforming expectations, despite a decline of 6.8% in corporate profits.
• Furthermore, the figures highlight a robust labor market, as weekly jobless claims remain lower than expected, potentially reducing the likelihood of interest rate cuts later this year.
• The latest release of FOMC minutes reveals diverging views among members, with some advocating for additional rate hikes, while others anticipate a reduced need for further tightening given signs of decelerating growth.
• Overall, the market sentiment reflects a delicate balancing act between positive economic indicators and ongoing uncertainties surrounding the debt ceiling negotiations,

The daily interval sees a return to the previous balanced price range, with trades occurring around the lower end of the quarter. Supportive buyers are present, but the overall bias for medium-term perspectives still indicates a downward trend. The intraday perspective also leans bearish, as negative volatility may deter potential buyers, depending on investor sentiment.

During intraday trading, there is a slight upside imbalance as traders focus on maintaining balance and value extremes within the session. Absorption occurs on both sides, resulting in a seemingly narrower trading range. Notably, the tech sector displays robust bullish trends, potentially influencing investor sentiment towards bullishness.

Investors continue to consider the matter of the debt ceiling, as any indications of a resolution could shift the focus towards buying and allow the market to flourish. Meanwhile, a sense of caution prevails, keeping the mood of buying in check. Secondary concerns encompass worries surrounding regional banking, recession fears, and the anticipated outlook of monetary policy, which are contingent on the resolution of the aforementioned debt ceiling issue.

More By This Author:

US Stocks Fall As Investors Await Debt Ceiling Developments
Consumer Prices In The UK Decreased To 8.7%
U.S. Manufacturing Sector Contracts, Services Sector Shows Strong Growth