US Market Rallies to Records Before Momentum Fades

The stock market started the day with a burst of strength, driven by Oracle’s (ORCL 328.33, +86.82, +35.95%) extraordinary rally and an encouraging August PPI report. The early enthusiasm was enough to push the S&P 500 (+0.3%) and Nasdaq Composite (flat) to fresh record highs, with the S&P 500 touching 6,555.97 and the Nasdaq reaching 22,000.97.

But that momentum faded as the session wore on, with investors reluctant to push deeper into record territory. By the close, both indices were well off their peaks, though they still managed to notch record closes — 6,532.04 for the S&P 500 and 21,886.06 for the Nasdaq Composite — while the DJIA (-0.5%) never made it above the flatline.

Oracle’s massive upside surprise was the focal point of the day’s trade. The company’s remaining performance obligations surged to $455 billion, up an astonishing 359% year-over-year, signaling a wave of locked-in cloud contracts from major AI players. The news ignited a rally across semiconductor names, with the PHLX Semiconductor Index climbing 2.4%. NVIDIA (NVDA 177.33, +6.57, +3.85%) and Broadcom (AVGO 369.57, +32.90, +9.77%) were among the day’s biggest gainers, helping lift the technology sector to a 1.8% gain — tying energy (+1.8%) as the best-performing sector of the day.

Not every tech giant joined the party Amazon (AMZN 230.33, -7.91, -3.32%), Apple (AAPL 226.79, -7.56, -3.23%), and Meta Platforms (META 751.98, -13.72, -1.79%) all fell sharply, hinting at a reallocation of capital as Oracle emerges as a bigger player in AI infrastructure. The mixed action in the “Magnificent Seven” left the Vanguard Mega Cap Growth ETF finishing the day flat, despite the strength from chipmakers.

Breadth was mixed as well, with six S&P 500 sectors finishing lower. Consumer discretionary (-1.6%), consumer staples (-1.1%), health care (-0.9%), and communication services (-0.9%) led the laggards, while financials (-0.3%) and real estate (-0.1%) saw more modest declines.

On the macro front, a surprisingly deflationary August PPI reading (-0.1% vs. 0.3% expected) initially powered stocks higher. Core PPI matched the headline figure with a -0.1% decline, providing a tailwind for rate-cut optimism. Despite the encouraging data, futures markets showed little change, holding steady with expectations for 75 basis points of rate cuts before the end of the year.

By the closing bell, it was clear that the market was still grappling with the tension between AI-driven growth enthusiasm and elevated valuations. Tomorrow’s August CPI report will provide the next major test, as investors assess whether cooling inflation and softening labor data can justify additional rate cuts and sustain momentum toward higher highs.

Our FTinvest 11 model portfolio index came under modest pressure today, spending the entire session in negative territory. While there were moments when the index attempted to recover, selling interest persisted into the afternoon. By the close, FTInvest 11 finished the day down 0.29%, settling at 855.22.

Despite today’s pullback, the index remains firmly in record territory, giving back only a small portion of its recent gains. The ability to stay well above the 850 level underscores that investor sentiment toward the portfolio remains broadly constructive, even amid some short-term profit-taking.

The next session will be watched closely to see whether FTInvest 11 can quickly regain upward momentum or if today’s dip signals a brief consolidation phase before the next leg higher.