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The Technology Sector Boosted Global Stock Market Growth

Last week, stock prices on global markets rose after three weeks of decline, primarily due to better-than-expected quarterly business results from several American tech giants. On Wall Street, the Dow Jones increased by 0.7 percent to 38,239 points, while the S&P 500 jumped by 2.75 percent to 5,099 points, and the Nasdaq index rose by 4.2 percent to 15,927 points.

For instance, Alphabet’s stock price soared by more than 10 percent just on Friday, while Microsoft’s rose by nearly 2 percent. Tesla’s stock price also saw a significant increase last week, but not due to business results, which were weaker than expected, but due to the announcement of new, cheaper electric vehicle models and restructuring, which includes the elimination of thousands of jobs.

On the other hand, Meta’s stock price sharply fell as the parent company of Facebook announced weaker business forecasts for the current quarter and higher costs than expected.

Despite the strong growth of stock indices, the market was very volatile during the week, primarily because it is becoming increasingly clear that the U.S. Federal Reserve will not aggressively cut interest rates this year as investors had hoped. During the week, it was reported that in the first quarter, the U.S. gross domestic product (GDP) grew by 1.6 percent year-on-year, significantly below analysts’ expectations and the slowest growth in nearly two years.

On the other hand, inflation in that quarter reached 3.4 percent year-on-year, while in the previous quarter it was 1.8 percent. Not long ago, it was expected that the Fed would start cutting interest rates from June, but it is becoming increasingly clear that the central bank will not rush to lower rates due to elevated inflation.

European stock prices also rose last week. The London FTSE index slipped by 1.3 percent to 7,895 points, while the Frankfurt DAX fell by 1.1 percent to 17,737 points. The Paris CAC, on the other hand, strengthened by 0.1 percent to 8,022 points.

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