U.S. equities inched higher on Friday and closed the week with modest gains after the Federal Reserve’s preferred inflation gauge, the core personal consumption expenditures (PCE) price index, hinted that a rate‑cut could be on the horizon. The S&P 500 rose 0.3% for the week, the Nasdaq climbed almost 1%, and the Dow added roughly 0.5%. Both the S&P 500 and Nasdaq logged back‑to‑back weekly advances, marking their second consecutive week of growth.
The September core PCE report, released on Friday morning, showed a year‑over‑year increase that was cooler than analysts had expected. Excluding volatile food and energy components, the core rate rose 2.6% on an annual basis, down from the 2.8% pace recorded in August. The data, delayed by the recent government shutdown, was welcomed by a market that has been starved for fresh macroeconomic signals ahead of the Federal Reserve’s two‑day policy meeting on Tuesday and Wednesday.
Since New York Fed President John Williams last signaled renewed openness to a rate‑cut, the S&P 500 has rallied about 5% and is now hovering just below its record‑high close of 6,890 set on Oct. 28. The market’s optimism is underpinned by the expectation that lower borrowing costs could reignite consumer spending and corporate capital‑allocation plans.
Tech‑Sector Highlights
Meta Platforms (META) posted a 4% weekly gain after Bloomberg reported that the company plans to slash metaverse‑related spending by up to 30%. CEO Mark Zuckerberg’s decision appears to be a strategic pivot toward near‑term monetizable initiatives, such as the rollout of Meta’s smart‑glasses and its expanding artificial‑intelligence portfolio. Meta’s aggressive cap‑ex in recent quarters has pressured margins, and the reduction in speculative spending is likely to improve cash‑flow visibility.
Salesforce (CRM) surged 13% for the week, delivering an earnings beat that helped it become the top performer in our portfolio watchlist. Despite the strong quarter, the stock remains 22% down year‑to‑date, reflecting investor concerns about the impact of generative AI on Salesforce’s subscription‑based CRM model. Management highlighted that AI should be viewed as a “commodity feature” that enhances, rather than replaces, the core value proposition of its software. The company also raised its FY 2026 outlook and reported growing traction for its Agentforce AI platform, suggesting that AI‑driven efficiencies could offset any potential cannibalization of traditional licensing revenue.
CrowdStrike (CRWD) reported better‑than‑expected FY 2026 Q3 results, posting record free‑cash‑flow, annual recurring revenue, and operating income. Although the stock moved little on the day, analysts note that the firm’s “trophy quarter” underscores the durability of its platform‑as‑a‑service model. Cybersecurity stocks often experience short‑term pullbacks after earnings, only to resume upward momentum in subsequent weeks as subscription renewals materialize. Consequently, we reaffirm a buy‑equivalent rating on CrowdStrike and lift the price target to $550 from $520.
Portfolio Moves This Week
We executed three trades based on valuation considerations and sector dynamics:
- Monday – Boeing (BA): Added to our position after the stock stabilized following a sharp post‑earnings slide in November. The aircraft maker’s earnings beat and improved order backlog justify a more cautious re‑entry.
- Tuesday – Procter & Gamble (PG): Increased exposure after the stock dipped on CFO Andre Schulten’s comments about a volatile U.S. macro environment. The consumer‑staples giant remains a defensive anchor amid potential AI‑related market rotations.
- Wednesday – Goldman Sachs (GS): Took partial profits as the stock closed at a record high on Friday. The investment bank’s diversified revenue stream and solid balance sheet keep it a long‑term hold.
Looking Ahead
The upcoming Fed meeting will be a pivotal moment markets. If the central bank signals a rate‑cut or adopts a more dovish stance, we could see a renewed rally in rate‑sensitive sectors such as technology, real estate, and consumer discretionary. Conversely, a hawkish tone would likely rekindle volatility, prompting investors to gravitate toward defensive holdings and high‑quality cash‑flow businesses.
On the technology front, the ongoing reallocation of capital toward AI‑enabled products—ranging from intelligent eyewear to enterprise‑grade predictive analytics—should continue to shape earnings trajectories. Companies that can demonstrate clear pathways to monetize AI without eroding existing revenue streams are likely to outperform.
Finally, the cybersecurity space remains a bright spot amid escalating threat landscapes. Firms that pair robust platform economics with strong cross‑sell opportunities, likeStrike and Palo Alto Networks, are well positioned to capture long‑term growth, even if short‑term price action appears muted after earnings releases.
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