US stocks rebounded on Monday on the heels of the S&P 500’s worst week since early 2023 as inflation came back into focus for investors gauging pressures that could influence the size of interest rate cuts.
The S&P 500 (^GSPC) climbed 1%, coming off a drop of 1.7% for the benchmark, as major US gauges closed with hefty losses. The Dow Jones Industrial Average (^DJI) jumped more than 400 points, or 1%, while the tech-heavy Nasdaq Composite (^IXIC) rose roughly 1%.
Stocks were on pace to regain some of the ground they lost after the August jobs report failed to settle a key question: How aggressively will the Federal Reserve lower interest rates? The neither-hot-nor-cold data left Wall Street guessing whether a cut of 25 or 50 basis points is likely at this month’s policy meeting.
Read more: Fed predictions for 2024: What experts say about the possibility of a rate cut
At the same time, comments by Fed officials appeared to tilt the market in favor of a 0.25% cut by suggesting that incoming data would have to support the need for larger and further easing.
Focus is now on a fresh consumer inflation print due Wednesday to provide clues to the path of rates. The reading on price pressures will be followed by a producer inflation report on Thursday, the last inflation inputs before the Fed’s policy decision on Sept. 18.
The corporate highlight of the week is Apple’s (AAPL) annual iPhone event, which kicks off on Monday. Apple is expected to launch its iPhone 16 line and provide an update on Apple Intelligence AI features, both closely watched as the likes of Huawei challenge the “Magnificent Seven” tech megacap in the market.
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Nasdaq rebounds 1% as Nvidia shares gain
Nvidia (NVDA) shares gained more than 2% on Monday, helping lift the Nasdaq. The tech heavy index rose as much as 1.2% to lead the market gains.
Nvidia stock rebounded after losing almost 14% last week. The AI chip heavyweight has underpinned the market rally this year.
EV giant Tesla (TSLA) also rebounded as much as 4% on Monday following a pullback on Friday.
The Nasdaq led the market rebound on Monday -
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