Wall Street Extends Rally as AI and Dovish Fed Fuel Risk-On Sentiment

14 October 2025, 05:53

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Key Takeaways:

*The S&P 500 hit another all-time high and Nasdaq rose 1.12%, as investors shrugged off the prolonged U.S. government shutdown.

*Dell jumped 9% to a two-year high, extending the AI-driven rally sparked by AMD’s breakout earlier in the week.

*The VIX fell to a five-month low while soft labor data fueled expectations of Fed rate cuts, sustaining risk appetite.

Market Summary:

U.S. equities advanced decisively, with the Nasdaq Composite gaining 1.12% and the S&P 500 notching another record high, as markets continued to look past the ongoing U.S. government shutdown. The persistent rally—now extending through the duration of the fiscal impasse—highlights the market’s singular focus on corporate catalysts and monetary policy expectations over political dysfunction.

Technology shares remained the primary driver, with Dell Technologies surging 9% to approach a two-year peak near $166.10, building on the momentum from AMD’s breakout earlier in the week. The sustained momentum in AI-related infrastructure names reflects broadening conviction in the sector’s growth trajectory beyond initial semiconductor leadership.

Market sentiment received a significant boost from the CBOE Volatility Index (VIX), which declined to its lowest level in five months. This notable drop in the “fear gauge” indicates exceptionally low levels of investor anxiety and suggests ample room for continued risk-taking amid the favorable backdrop.

The bullish impulse was further reinforced by growing expectations for Federal Reserve easing, supported by recent labor market softness including the weaker-than-anticipated ADP employment report. The combination of resilient corporate performance, subdued volatility, and anticipatory monetary policy has created a potent mix for equity appreciation, overwhelming concerns about governance credibility and fiscal stalemate.

Technical Analysis

Nasdaq, H4:

The Nasdaq Composite surged more than 1% to a fresh all-time high in the previous session, decisively reversing an earlier false breakout below its uptrend support line. The robust recovery underscores the underlying strength of the current bullish trend and suggests that buyers remain firmly in control of the near-term direction.

The index’s ability to quickly reclaim its upward trajectory following a brief technical violation indicates strong institutional support at elevated levels. This pattern of shallow, short-lived pullbacks followed by immediate recoveries is characteristic of sustained bullish momentum and often precedes further advances.

Momentum indicators are aligned with the constructive price action. The Relative Strength Index has rebounded from above its midline and is approaching overbought territory, reflecting intensifying buying pressure. Meanwhile, the Moving Average Convergence Divergence has generated a bullish crossover above its zero line, confirming that a fresh wave of positive momentum is building.

Resistance Levels: 25260.00, 25,550.00

Support Levels: 25,040.00, 24,830.00