Stocks Push to New Records on Fed Optimism and Semiconductor Strength

The first full trading session after the Fed’s policy decision delivered fresh record highs across major indices, as easing optimism and a rebound in mega-cap tech fueled broad gains. The S&P 500 rose 0.5%, the Nasdaq Composite climbed 1.0%, and the Dow Jones Industrial Average added 0.3%, with all three indices setting new intraday and closing records.

Notably, the Russell 2000 surged 2.5%, breaking through its record intraday peak from late 2024 and its closing high from 2021. The S&P Mid Cap 400 followed suit with a 1.3% advance, underscoring renewed investor enthusiasm for smaller names amid firming rate cut expectations. According to the CME FedWatch Tool, markets now see a 91.9% probability of another 25-basis-point cut in October and an 82.3% chance of a further cut in December, both sharply higher than before yesterday’s announcement.

Technology stocks led the charge. NVIDIA climbed 3.5%, reclaiming its 50-day moving average, while Intel soared nearly 29% after disclosing that NVIDIA will take a $5 billion equity stake as part of a multi-year collaboration on custom data center and PC products. The news helped the PHLX Semiconductor Index rally 3.6%, while the broader information technology sector rose 1.3%, topping the leaderboard. Industrials also performed well, adding 1.1%, while most other groups posted more modest gains.

Losses were limited to the consumer staples (-1.0%) and consumer discretionary (-0.5%) sectors, which faced pressure despite the market’s upbeat tone. Breadth figures told a positive story: advancers outpaced decliners by nearly 2-to-1 on the NYSE and almost 3-to-1 on the Nasdaq. The equal-weighted S&P 500 outperformed the market-cap weighted version, rising 0.7% against 0.5%, though mega-caps still played an important role, with the Vanguard Mega Cap Growth ETF advancing 0.5%.

Earnings results tempered enthusiasm in a few corners. Restaurant operators Darden and Cracker Barrel both fell sharply after disappointing reports, while FactSet dragged its peer S&P Global lower following its own earnings miss.

Overall, the day’s action underscored renewed confidence in monetary easing and AI-driven tech growth, setting a strong tone as markets prepare for the final stretch of September.

Our FTinvest 11 model portfolio index staged an impressive advance today, gaining 0.99% and setting a new milestone by crossing the 870 threshold for the first time. After a steady climb through much of the session, the index closed at 871.46, marking a new all-time record high.

Momentum was strong from the opening bell, and unlike earlier sessions where late weakness pared gains, today’s move was sustained, underscoring firm underlying demand across portfolio components. The record close also reinforces the portfolio’s recent trend of consistent upward movement, putting it firmly ahead of its previous peaks.

With today’s breakout, FTinvest 11 continues to demonstrate resilience and strength, confirming its leadership against broader benchmarks and showing that investor appetite remains robust even after an already strong run.