Nasdaq 100: +0.94%
S&P 500: −0.08%
My portfolio: +3.13%
Market pulse
American equities finished the week divided. The Nasdaq 100 advanced, while the S&P 500 ended almost unchanged after recovering from losses earlier in the week. The closing figures concealed a volatile struggle between tighter monetary policy, expensive oil and renewed confidence in parts of the AI trade. Both indices recovered strongly on Thursday, allowing technology shares to finish the period in a better position than the broader market. Nasdaq 100 closing data, S&P 500 closing data.
The most significant development was the Federal Reserve’s decision on Wednesday to raise its policy rate by 0.25 percentage points to 3.75–4.00%. The unanimous decision reflected a combination of persistent inflation and resilient economic activity. The accompanying projections pointed to another quarter-point increase before year-end, followed by rates remaining at that higher level through 2027. For equities, the challenge was the prospect that borrowing costs would remain elevated for longer, increasing the pressure on valuations and financing-sensitive businesses. Federal Reserve statement, September economic projections.
Oil was the second major influence. Prices remained above $100 a barrel, with damage to Saudi Arabia’s East–West pipeline and disruption around key shipping routes keeping supply concerns prominent. Expectations that the pipeline could reopen at partial capacity, together with diplomatic efforts to restrain Houthi attacks, offered some relief. Nevertheless, expensive energy continued to complicate the inflation outlook. Ten-year Treasury yields remained around 5%, leaving companies and investors facing a demanding combination of high energy costs and expensive capital. Nasdaq’s weekly market review.
AI supplied the week’s sharpest change in sentiment. Calls from leading developers to slow the advancement of powerful models triggered an early selloff in semiconductor shares. Investors had to consider whether a more cautious development cycle could affect future infrastructure spending. The sector subsequently recovered, however, as attention returned to evidence of strong computing demand. The rebound helped explain why the Nasdaq 100 ultimately performed better than the S&P 500. Reporting on the initial semiconductor selloff, Nasdaq’s weekly review.
Economic data reinforced the impression that the American economy remained resilient. August retail sales increased 1.2% from July, while weekly unemployment claims fell to 196,000. Stronger spending and low layoffs supported the earnings outlook, but also reduced the urgency for the Fed to provide monetary relief. The market therefore continued to face a familiar tension: economic strength supported corporate revenues while making a sustained decline in interest rates less likely. Census Bureau retail-sales release, Reuters on unemployment claims.
Crowd vs. price
The week showed how differently investors could price companies associated with the same broad investment theme. AMD and Palantir gained strongly, while ASML finished lower. Exposure to AI alone did not determine the outcome; the immediate evidence surrounding each company mattered. AMD benefited from signs of strong demand for computing capacity, Palantir received renewed analyst support for its enterprise-AI business, and ASML remained exposed to concerns about the future pace of infrastructure investment. AMD coverage, UBS’s Palantir assessment, ASML and the AI selloff.
Investors remained willing to pay for growth when they could connect it to current demand, customer adoption or pricing power. They were less comfortable relying entirely on uninterrupted future expansion. That distinction becomes more important when bond yields are high: distant earnings have to compete with increasingly attractive returns available elsewhere.
Holdings & Watchlist Notes
AMD: +8.46%
The clearest catalyst came on Thursday, when Nebius announced higher cloud-computing prices, including a 25% increase for instances using AMD EPYC Genoa processors. This was an increase in the customer’s cloud-service pricing, rather than AMD’s own chip prices, but it offered evidence that demand remained strong. AMD gained 6.36% that day, accounting for most of its weekly advance. The move reinforced the investment case that growing AI workloads can support demand for conventional server processors as well as accelerators. AMD’s Thursday rally, Reuters on Nebius’s pricing increases.