August 17, 2025

Wall Street was buzzing with excitement but also a bit of suspense as the US stock market indexes tried to keep their winning streak alive. The Dow Jones, S&P 500, and Nasdaq started last week strong but took a slight dip on Friday. The S&P 500 slipped just 0.3% from its record high set the previous day, yet it still wrapped up its fourth winning week out of the last five. Meanwhile, the Dow Jones flirted with its own record from last December and ended the day up by 34 points or 0.1%. The Nasdaq fell 0.4% but stayed close to its all-time high reached a day earlier. Why the jitters? All eyes are on the Federal Reserve and its Chair Jerome Powell who will soon decide if they cut interest rates. Lower interest rates mean it’s cheaper for people and companies to borrow money to buy homes, cars, or new equipment. This can boost investments and the economy but could also fan inflation. Andrew Slimmon, head of Applied Equity Advisors at Morgan Stanley Asset Management, shared some juicy details: "Companies likely to benefit most from lower borrowing costs have been among the big winners in recent Wall Street trading." The star performers have been top homebuilders like PulteGroup, Lennar, and D.R. Horton. Their shares jumped between 4.2% and 8.8% last week, fueled by falling mortgage rates. These gains far outshone the 1% rise in the S&P 500 over the same period. Over the past month, these homebuilders have truly dazzled, with jumps from 15% to 22% compared to just 3.3% for the S&P 500. But there’s a twist! Their future success depends on mortgage rates staying low. Recently, the 10-year Treasury bond yields inched higher, which casts some doubt over whether mortgage rates will keep falling. The market hangs on a delicate balance, waiting to see if the Federal Reserve will cut rates in September. Will we see fireworks or fizzle? For now, investors are watching every move closely.

Read More at Economictimes →

Tags: Us stock market, Federal reserve, Interest rate cut, Homebuilders, S&p 500, Dow jones,