Stock Market Analysis for October 6, 2024

Summary of Last Week

Last week saw significant volatility in the stock market driven by a combination of geopolitical tensions and economic data releases. On Thursday, the U.S. Labor Department reported that non-farm payrolls increased by 250,000 in September, higher than expected. However, the unemployment rate ticked up to 4.2%, raising concerns about wage growth and consumer spending.

Key Events Impacting the Market

1. Interest Rate Speculation: Fed officials hinted at a potential interest rate hike in early 2025 due to persistent inflationary pressures. This ignited concerns about borrowing costs and its impact on corporate profits.
2. Geopolitical Tensions: Escalating tensions in Eastern Europe have created uncertainty in the energy markets, further impacting investor sentiment. Investors are closely monitoring crude oil prices, which hit a 10-month high last week.
3. Earnings Season Ahead: As we head into the earnings season, investors are expected to scrutinize quarterly results, especially from tech giants and financial institutions.

Major News of the Week

• The S&P 500 ended the week at 4,050, marking a 1.5% decline week-over-week.
• Tesla (TSLA) shares fell 3% after disappointing delivery numbers for Q3 2024.
• Apple (AAPL) announced a new product launch event scheduled for next week, which could give a boost to its stock.

Predictions for the Coming Week

Investors should be cautious as market sentiment is fragile, particularly given the upcoming inflation data and earnings reports.

Recommended Actions

• BUY: Consider buying ETFs like SPY (S&P 500 ETF) for long-term exposure to the market.
• SELL: It may be prudent to take gains on individual stocks like Tesla (TSLA) due to recent performance volatility.
• Watch for economic indicators being released on Wednesday, particularly the Consumer Price Index (CPI), which might catalyze further volatility in the market.

Conclusion

As we move into the new week, the focus will be on economic indicators and corporate earnings reports. Market participants should stay informed and adjust their strategies accordingly.