Economic Reports Confirm Smaller Rate Cuts Ahead
The inflation story in the U.S. continues to improve, but August’s Consumer Price Index report indicates that prices are slow to drop across the economy. The slowdown of inflation will prevent the possibility of a big Fed rate cut in the weeks ahead. The market is reacting positively since the uncertainty of the size of the rate cut is now becoming clear. But how long will the optimism last and what sectors are likely to continue pushing higher from here?
The Fed’s Soft Landing Faces Turbulence
Treasury Secretary Janet Yellen says the U.S. is still on the path to a soft landing, but investors aren’t acting that way, selling off shares to make last week one of the worst weeks in a year. So what is it that she sees that investors don’t? How will the recent string of data affect the Fed’s decision to cut interest rates later this month? The previous two monthly jobs reports may show turbulence on the way to a soft landing.
Can The Pivotal Jobs Report Save The September Blues?
It seems like for months we’ve been focused on reports like the Consumer Price Index, Producer Price Index, and Gross Domestic Product growth. Everything had to line up perfectly to give us the soft landing, and for weeks, we were hoping to see a slowdown in growth just enough to give the Fed reason to cut interest rates. Now investors are getting that slowdown they asked for, but the stock market is falling instead. What can stop the fall and where can the market head from here?
Nvidia Day Is Over – Now What?
With Nvidia representing 7% of the S&P 500, it’s no wonder why investors were held hostage to Nvidia’s earnings report, but now that is beyond us, what can we expect next? Before we get too far, Nvidia’s earnings remind me of years ago when I was trading Apple regularly and the stock got punished for making billions, but not enough billions in profit. Or they sold millions of phones, but not millions + 1. Nvidia’s earnings still show this market has room to go higher, but we’re still on fragile ground.
Mission Accomplished
Despite investors’ hesitation toward the Jackson Hole Symposium, the event finished with the much-anticipated message from the Fed that it is now time for interest rates to come down. The market has already been pricing in rate cuts, so the next thing to watch for is how quickly rate cuts will be implemented. The market is pricing in a 0.25 basis point cut in September. How will this news impact trading for the week ahead?
The Fed’s Jackson Hole Gathering Brings Volatility
The Jackson Hole Symposium, a key gathering of central bankers and economists in Jackson Hole, Wyoming, runs from August 22-24. Powell is slated to deliver his remarks today at 10 a.m. Eastern time. The major indices fell over -0.05% yesterday, showing just how jittery investors are, waiting for a signal of upcoming Fed moves. You may remember 2022 when Powell spoke at Jackson Hole (a -5.5% move), but what does history have to say about the S&P 500 performance during this event?
Searching For Stocks In Top Sectors
Stocks are rallying as investors jump back into technology stocks, again favoring growth over value. Investors quickly forget about the headwinds that spooked them in July and are jumping back into the market. The next leg higher of this rollercoaster ride has started, even though a week ago many investors were ready to sit on the sidelines. What happened this week and how can you find opportunities to take advantage of the movements?
Growth-Over-Value Takes Over, But How Long Will It Last?
July saw the great rotation out of mega-cap stocks into… well, everything else. The Great Rotation helped push the Russell 2000 index higher as investors sought gains on stocks waiting in the wings. It hasn’t lasted though, as growth stocks are regaining strength and value stocks are rolling over. Growth has taken back over, but how long will this last?
Indecisive Market Leads Many To Want To Sit On The Sidelines
The roller coaster ride continues as Japan eases off on rate hikes while the U.S. jobless claims come in less than expected, showing maybe the economy isn’t as bad as people fear. While the S&P 500 recently made new multi-week lows, the bulls are trying to regain control and looking to finish the week on a strong note. What’s in store for the week ahead?
Whiplash Has Investors Running Away From The Market
A few short weeks ago the market hit all-time highs and many investors had never heard of the Yen Carry Trade. Two weeks later the S&P 500 dropped nearly 10% from its highs and the Yen Carry Trade is on everyone’s mind. While Japan may have recovered from one of its worst trading days in decades, the damage is done to the U.S. and a V-shaped recovery may not be in the cards. Let’s review what you need to know to keep you on the right track.
