Last week’s U.S. equity markets finished mostly higher, bolstered by the Federal Reserve’s anticipated interest-rate cut, signaling a pivot toward easier financial conditions.

The decision was not unanimous, leading to some confusion about future direction. Some high-profile technology earnings reports disappointed, causing pullbacks in AI- and growth-oriented stocks and raising valuation concerns about the sector. Economic data indicated cooling inflation and modest labor-market softening, supporting the Fed’s move as potentially the start of a broader easing cycle. Geopolitical risks persisted, contributing to a constructive yet cautious market close.

Next week, markets will likely be driven by key economic data and inflation signals, especially the Personal Consumption Expenditures (PCE) price index—the Fed’s preferred gauge—which could influence views on future rate cuts after its recent policy pivot. Earnings from big tech, industrial, and consumer firms will spotlight forward guidance on demand, margins, and costs. As the holiday season and year-end approach (often boosted by seasonal trends), these factors—plus economic reports, corporate updates, and geopolitical news—may set the tone for the year’s close.

Given this economic backdrop, let us see how this impacts the performance of various investment strategies.