With expectations of a December Federal Reserve rate cut gaining traction, asset managers are shifting into risk-on mode, favoring technology and growth stocks across major indices. SPX, QQQ, and NDAQ all posted gains, led by TSLA and MSFT.
- SPX closed at 5,238.71, marking its third consecutive weekly gain.
- QQQ rose to 217.35, its highest level since October 2025.
- NDAQ advanced 1.9% to 18,472.33, reflecting broad-based momentum in tech and communication services sectors.
- TSLA surged 4.8% amid renewed optimism around AI-driven demand and global EV expansion.
- MSFT climbed 3.2% as cloud revenue growth and strong earnings from its Azure division reinforced investor confidence.
- Market pricing now reflects a 76% probability of a 25-basis-point rate cut in December, up from 58% a week earlier.
Asset managers are increasingly allocating capital to equities, reflecting a pronounced shift toward risk-on positioning as the market prices in a near-term Federal Reserve rate cut. This sentiment emerged during a data-rich week, with investors focusing on inflation indicators and labor market trends that support expectations of a dovish pivot in December. The S&P 500 (SPX) rose 1.4% over the session, extending gains for the week, while the Nasdaq-100 (QQQ) advanced 2.1%, driven by strong performance in tech-heavy names.