Big techs back in favour

September is traditionally considered a difficult month for equities, so many investors approached it with caution. The first shortened week of autumn (with Labour Day in the U.S. on Monday) largely confirmed those concerns. Still, the results suggest that little has actually changed.

Indexes continue to climb, repeatedly setting fresh all-time highs, but the picture is far from flawless. The NASDAQ Composite rose a confident 1.14% over the week, while the key U.S. benchmark – the S&P 500 – managed only a modest 0.35%. The veteran Dow Jones (DJIA-30) briefly touched a new all-time high of 45,770 points but ended the week down 0.32%.

Weak labour market data was the main source of investor unease. According to the BLS, job creation fell short of expectations and is moving steadily towards zero. On the one hand, this could encourage the Fed to cut rates at its upcoming FOMC meeting. On the other, it highlights a worsening economic backdrop. These conflicting signals set the tone for the week.

Against this backdrop, the ITS family of indexes performed strongly, outpacing their U.S. counterparts. The ITS World Index (ITSW) gained a solid 1.54%, supported by broad geographical diversification. The ITS Shariah Index (ITSS) added a more modest 1.13%, still comparable to the week’s U.S. leader – the NASDAQ Composite.

The key driver of growth for both U.S. and ITS indexes (except the Dow) was Alphabet (GOOG), whose shares jumped more than 10%.

The rally followed a U.S. court ruling that the company would not be forced to divest Chrome and Android, removing months of uncertainty over whether regulators might dismantle Google’s search empire. On Wednesday, the shares surged 9% – their biggest one-day gain in years – adding about $210 billion to Alphabet’s market value.

Judge Amit Mehta ruled that Google could keep Chrome and Android but must drop certain exclusive contracts that restricted competition. At the same time, the court allowed it to continue paying Apple billions of dollars to remain the default search engine on iPhones – a partnership estimated at $20 billion.

Apple shares rose nearly 4% on the news. For Google, the ruling removed the worst-case scenario, though pressure on its business model remains. Regulators continue to demand that it share parts of its search index with rivals to support AI development. Analysts, however, believe such measures are limited and unlikely to seriously undermine Google’s dominance in online search.

Investors welcomed the news. Alphabet shares reached an all-time high and are now up more than 23% year-to-date, well ahead of the S&P 500. Even so, they still trade at lower valuations than other “Magnificent Seven” members, leaving scope for further growth – particularly if its AI bets, such as Gemini, pay off.

Overall, while equity markets continue to rise, underlying tensions are increasing. They are likely to persist until the Fed announces its rate decision on 17 September.

 

 

Market outlook for 4 june 2025

The week opened calmly despite weak U.S. labour data on Friday and signs of political crisis in France and Japan. Investors still appear confident about the global economic outlook – at least judging by Monday’s market moves, with most indexes in positive territory. Gains, however, remain modest and nowhere exceed 1%.

Key events are expected from Wednesday, when U.S. inflation figures will be released. Producer prices (PPI) are due that day, followed on Thursday by the consumer price index (CPI) – the main inflation gauge.

The Bureau of Labor Statistics is forecast to report August inflation at 2.9%, up from 2.7% in July. At that level, the Fed faces challenges on both sides of its dual mandate – supporting maximum employment while keeping inflation close to its long-term 2% target. This raises the risk of stagflation – a mix of high inflation and rising unemployment.

The Fed will be in a “quiet period” this week, meaning no official comments. Markets must therefore rely on past statements and their own forecasts.

On the corporate side, Oracle and Adobe are set to report quarterly results, both expected to show strong growth. Oracle in particular is making a $25 billion bet on AI and cloud, anchored by its $500 billion Stargate project – a story some analysts view as one of the most undervalued on Wall Street.

Another highlight is Apple’s traditional September product launch, scheduled for Tuesday at Apple Park. New iPhones, Apple Watches and accessories are expected, along with updates to AirPods, Apple TV and iPad Pro. The goal is to help Apple maintain its edge against Samsung, Google and Chinese rivals Huawei and Xiaomi.

Still, there is a risk that investors will be underwhelmed. Apple is not expected to unveil major AI innovations – a gap in today’s tech-driven market narrative. As a result, the event could even weigh on the company’s share price.

The week looks set to be both busy and demanding. Whether current optimism can hold remains uncertain. With the holiday season now over, the coming days may well define the market’s direction for the months ahead.