Top market takeaways after stocks rallied on Fed decision

Markets (^DJI, ^IXIC, ^GSPC) put a positive cap on the trading week, all three of the five-day moving averages closing Friday in the green. Stocks rallied around the Federal Reserve's latest monetary policy decision on Wednesday.

Yahoo Finance Reporter Alexandra Canal joins the Live show to highlight the biggest events impacting stocks, including economic and housing data prints and even the Department of Justice's antitrust lawsuit levied against iPhone maker Apple (AAPL).

For more expert insight and the latest market action, click here to watch this full episode of Yahoo Finance Live.

Editor's note: This article was written by Luke Carberry Mogan.

Video transcript

JULIE HYMAN: Let's get to Yahoo Finance senior reporter Alexandra Canal. Hey, Allie.

ALEXANDRA CANAL: Hey.

JULIE HYMAN: So as we talked about, it was a Fed week. And so that has to do with how you were viewing the week as well.

ALEXANDRA CANAL: Yes, there was a lot of anticipation heading into this meeting, particularly when it came to those dot plots, right? Where are we going to see the Fed maintain its projection of three cuts this year? And I thought it was interesting because, Josh, you and I were talking to a friend of the show, Michael Antonelli, earlier this week. And he basically came at the notion it doesn't matter if the Fed cuts once, twice, or maybe even not at all because the economy is so strong.

And I think what we got from the summary of economic projections really highlights that fact. Fed officials are penciling in that higher economic growth. They upwardly revised their revisions for GDP to 2.1%. That's up from the 1.4% the Fed officials expected back in their December projections.

They also said that unemployment was going to fall to 4%. That's down from 4.1% in their projections. So it seemed like the Fed is increasingly confident that we're going to achieve this soft landing narrative.

And it might not matter so much when it comes to when they cut, if they cut because the economy has just remained so incredibly resilient. You can even look at something like existing home sales, for example, that shot up 9.5% in February over the prior month, homes that are very interest-rate-sensitive area of the market. But they're doing well, the market's still tight, inventories up. Possible sign that maybe we've reached the low point there.

So I think the story here is that the economy is performing well and stocks are at record highs. We're still at pretty high interest rates despite all of that. So as long as the economy remains resilient, that might lead us into that soft landing camp.

JOSH LIPTON: Yeah, it was interesting because we were just talking to a strategist today and the fundamentals, she was saying, I think she agreed economy is strong and that should drive corporate profits. The question is, how much are you willing to pay for that? And I think she was kind of skeptical about that multiple.

JULIE HYMAN: Yes, definitely. Well, and speaking about skeptical of multiples, we were talking about the Mag Seven, the subject of the negative side of Good Buy or Goodbye today was interestingly NVIDIA. So clearly, people are looking at some of these multiples, but in particular in the Mag Seven. Apple had a tough one this week.

ALEXANDRA CANAL: No good, very bad week is what I'm calling Apple. That DOJ antitrust lawsuit, I mean, wiped off billions of dollars off of the market cap. The stock closed down more than 4% on Thursday.

We have bounced back off of those lows with the stock up about a half a percentage point today. But I think this underscores the potential cracks in the Mag Seven that we've been discussing and talking about, this broadening of the rally. Apple's not the only one in that camp. Tesla as well.

We have heard from analysts that tech is a pretty crowded space and there could be room for a potential pullback this year. That's probably a point that you were discussing in your Good Buy or Goodbye play. And I think the fact that Microsoft has now surpassed Apple in market cap in that Mag Seven, the fact that Apple is going to continue to face these challenges.

And as we head deeper into this antitrust competitive lawsuit, I do think that we could see further pullback in some of these tech names in these tech stocks. That being said though, I do think tech continues to show some resiliency. I mean, it was the only major index to close in the green today. And if you take a look at the sector action, communication services, tech, and utilities are--

JULIE HYMAN: NVIDIA was at a record again today. There's one group that did not do well today.

ALEXANDRA CANAL: Yes.

JULIE HYMAN: And just briefly, athleisure which we talked a little bit about under some pressure.

ALEXANDRA CANAL: Yeah, and this all has to come from guidance and outlook. And what's interesting about Lululemon, it's a very high-end consumer. But the CEO on the earnings call said that they're seeing this shift in consumer behavior, which potentially signals some fatigue when it comes to demand there.

And then on the Nike side, they have increased competition. So I just wonder if this could be the end of this athleisure boom that we've been seeing since COVID. Now, we're a few years removed, but these results certainly are disappointing.