NEW YORK – The S&P 500 ended near unchanged on Sept 24, with Microsoft dipping and Meta Platforms rising, as uncertainty about the Middle East lifted oil prices and Treasury yields.
The S&P 500 and Nasdaq rebounded from session lows after Reuters reported US and Iranian negotiators were exploring a phased path out of war that would involve Tehran reopening the Strait of Hormuz and Washington lifting its economic blockade of Iran.
US and Iranian leaders exchanged barbs this week at the UN General Assembly. Brent crude prices rose over 3 per cent to nearly US$107 per barrel after a Houthi missile attack on Saudi Arabia revived fears of supply disruptions.
“This just reinforces the view that we’re dealing with one major market catalyst right now,” said Bill Northey, senior investment director at US Bank Wealth Management. “It’s really all about oil and inflation and the effect on interest rates, and then the interest rate cascading across the capital markets.”
AI heavyweights were mixed, with Microsoft and Broadcom losing ground, while Advanced Micro Devices rose.
Meta Platforms climbed, a day after the social media company unveiled a small handheld gadget for use with its recently launched AI assistant.
Oracle fell after a report said the company sent a “force majeure” notice to a New Mexico data center. Shares of Blue Owl, the project’s developer, also fell sharply.
Treasury yields rose, with the 30-year Treasury bond yield reaching its highest since 2004. Higher yields make safe-haven Treasuries relatively more attractive to investors than stocks with uncertain returns.
According to preliminary data, the S&P 500 lost 2.20 points, or 0.03 per cent, to end at 7,703.83 points, while the Nasdaq Composite gained 1.76 points, or 0.01 per cent, to 26,937.79.
The Dow Jones Industrial Average fell 162.41 points, or 0.32 per cent, to 51,349.18.
The S&P 500 this week has traded just under 19 times expected earnings, its lowest valuation since 2023, according to LSEG data. AI-related heavyweights are responsible for much of the recent increase in earnings expectations.
US President Donald Trump welcomed Chinese President Xi Jinping to the White House for a summit expected to be heavy on symbolism but light on substance, related to issues including AI, trade, Taiwan and the war in the Middle East.
Data on Sep 23 suggesting strong business activity has led to increased expectations the Federal Reserve will raise interest rates again following its 25-basis-point hike last week. Traders are now pricing in a nearly 70 per cent chance of a hike in October, according to the CME FedWatch Tool.
New York Fed president John Williams, who has a vote on the Federal Open Market Committee, on Sept 24 said it was reasonable to think that the US central bank might need to raise interest rates again before the end of the year.
MGM Resorts slumped after media mogul Barry Diller’s People withdrew its proposal to purchase the casino operator. REUTERS
