Sept 25 V7N - On Wednesday, Wall Street's main indexes showed mixed results as the S&P 500 hovered close to record highs, with investors anticipating more economic indicators and potential interest rate cuts. The indexes were buoyed by monthly gains following the Federal Reserve's recent rate cut, which raised hopes for a soft landing for the economy. However, a disappointing consumer sentiment report released on Tuesday raised concerns about the labor market's health. Long-term Treasury bond yields increased, reflecting fears that easier financial conditions could reignite inflation. According to CME Group's FedWatch Tool, the probability of a 50 basis point cut by the central bank in November rose to 57.4%, up from a near 50% chance earlier in the week.

As of 11:42 a.m., the Dow Jones Industrial Average fell by 202.11 points (0.48%) to 42,006.11, while the S&P 500 remained nearly unchanged at 5,732.92. The Nasdaq Composite, on the other hand, gained 47.87 points (0.26%) to reach 18,122.39. Six out of the eleven sectors in the S&P 500 declined, primarily led by energy stocks, while technology shares saw a slight uptick, bolstered by a 3% increase in Nvidia’s stock. The Dow's decline followed record highs, largely due to a 4.8% drop in Amgen shares, which faced scrutiny after mixed results on two drugs raised competition concerns. Despite a significant 20% rise in both the S&P 500 and Nasdaq this year, fueled by rate cut expectations and enthusiasm for artificial intelligence, valuations remain notably above long-term averages, causing some market analysts to express concerns about potential overvaluation.

In economic news, new single-family home sales in the U.S. fell in August; however, lower mortgage rates and home prices may spur demand in the coming months. Investors are particularly focused on upcoming weekly jobless claims and the personal consumption expenditure (PCE) index for August. Remarks from Fed Governor Adriana Kugler after market hours and a speech by Chair Jerome Powell at the New York Treasury Market Conference on Thursday are also anticipated. Among individual stocks, Apple slipped 0.7% after data revealed a decline in iPhone sales in China, while major banks like Citigroup and JPMorgan contributed to a 1.2% drop in the broader bank index. KB Home fell 4% after reporting disappointing third-quarter profits, while Hewlett Packard Enterprise led the S&P 500 with a 4.8% gain following a rating upgrade. Conversely, Ford and General Motors saw declines of 4.3% and 5.3%, respectively, after Morgan Stanley downgraded their recommendations. Overall, declining stocks outnumbered advancing ones on both the NYSE and Nasdaq. The S&P 500 recorded 34 new 52-week highs, whereas the Nasdaq noted 55 new highs but also 57 new lows.

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