Analyst picks shine as S&P500 closes green despite retail earnings, tariff news and Powell speech

The S&P500 closed positively on Friday, despite retail earnings, tariffs, and Fed Chair Jerome Powell's speech. Analysts' top picks include Caterpillar, Palo Alto, and HPE. The Nasdaq lost over 2% for the week.

The S&P 500 closed positively on Friday, August 23, 2025, despite mixed retail earnings, tariff-related news, and Federal Reserve Chair Jerome Powell's speech. The market's reaction to these factors underscored ongoing economic uncertainty and the Fed's role in managing it. The S&P 500 climbed 1.5% after investors processed the latest data [1].

Powell's speech at the annual gathering in Jackson Hole, Wyoming, hinted at a potential interest rate cut, signaling a shift in the Fed's policy stance. The market's reaction was swift, with investors increasing the chances of a quarter-point cut to 91% from 75% [1]. The Dow Jones Industrial Average closed up 846 points, or 1.8%, while the tech-heavy Nasdaq increased 1.8%, driven by gains in major tech stocks such as Intel, Tesla, and Delta Air Lines [1].

Retail earnings also played a significant role in Friday's market performance. Several retailers reported mixed results, with some companies beating expectations while others missed the mark. The varied earnings reports contributed to the overall market's cautious optimism.

Notable analyst calls included Caterpillar, Palo Alto Networks, and Hewlett Packard Enterprise (HPE) as top picks. Caterpillar, in particular, saw its stock rise after announcing a long-term collaboration with Hunt Energy Company to deliver efficient, independent energy production for data centers. This partnership positions Caterpillar to leverage its advanced power solutions and Hunt Energy’s infrastructure experience, potentially reshaping its outlook in digital infrastructure markets [2].

The market's reaction to Powell's speech and the retail earnings reports underscores the ongoing economic uncertainty and the Fed's role in managing it. As the Fed continues to monitor the hiring slowdown and tariff-driven price increases, investors remain watchful for further policy shifts that could impact the broader economy.

The Nasdaq lost over 1% for the week, underscoring the ongoing tech sector volatility. The tech-heavy index was supported by gains in major tech stocks such as Intel, Tesla, and Delta Air Lines. However, the overall market sentiment remained cautious due to the uncertainty surrounding tariffs and the Fed's policy stance.

References:
[1] https://www.ainvest.com/news/caterpillar-palo-alto-hpe-analyst-top-picks-retail-earnings-tariff-news-2508/
[2] https://www.nasdaq.com/articles/stocks-rally-sharply-dovish-fed-chair-powell?time=1756046460