Posts by Gary Hall

Summary Of the Markets Today:

• The Dow closed down 159 points or 0.39%,
• Nasdaq closed down 1.12%,
• S&P 500 closed down 0.60%,
• Gold $2,542 down $11.30,
• WTI crude oil settled at $75 down $0.77,
• 10-year U.S. Treasury 3.841 up 0.008 points,
• USD index $101.12 up $0.56,
• Bitcoin $58,907 down $293 or 0.49%,

*Stock data, cryptocurrency, and commodity prices at the market closing.

Today’s Highlights:

Tech stocks led the market lower on Wednesday as investors awaited Nvidia’s highly anticipated earnings report after the closing bell. Here are the key points:

• The major stock indexes all declined.
• Nvidia shares fell about 2% ahead of its Q2 earnings release at 5 pm eastern (the same time this newsletter is published). The chipmaker’s results are seen as a crucial test of AI spending and tech sector strength.
• Traders are expecting a potential 10% swing in Nvidia’s stock price following the report. Wall Street is forecasting massive year-over-year growth in Nvidia’s earnings and revenue.
• The Information Technology sector was the worst performer in the S&P 500, declining 1.4%.
• Other notable movers included SuperMicro Computer, which fell 19% on a delayed annual report filing, and retailers Abercrombie & Fitch and Foot Locker, which both dropped double digits.
• Nvidia’s earnings are being closely watched for insights on AI demand and chip production, with potential to move the broader market given the company’s $3.2 trillion valuation and 160% stock gain this year.

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Click here to read our current Economic Forecast – September 2024 Economic Forecast: One Recession Flag Removed With Three Remaining

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Today’s Economic Releases Compiled by Steven Hansen, Publisher:

No economic releases today.

Here is a summary of headlines we are reading today:

• Small Tax on Super-Rich Could Yield Billions for Caucasus, Central Asia
• Argentina Plans to More Than Double Lithium Revenues by 2027
• Why Brand Loyalty Takes a Backseat for American Car Buyers
• Oil Unmoved by Crude, Gasoline Draws
• Nvidia reports earnings after the bell
• S&P 500, Nasdaq close lower Wednesday, Nvidia tumbles before earnings: Live updates
• The Fed now will focus on the employment part of its mission — and for good reason
• Super Micro shares fall 19% on filing delay, Hindenburg Research report
• Google to relaunch tool for creating AI-generated images of people after pulling service due to inaccuracies
• Supreme Court refuses to revive Biden’s latest student loan debt relief plan
• Oil settles lower, with the end of the summer driving season likely to weaken demand

Click on the “Read More” below to access these, other headlines, and the associated news summaries moving the markets today.

Summary Of the Markets Today:

• The Dow closed up 10 points or 0.02%,
• Nasdaq closed up 0.16%,
• S&P 500 closed up 0.16%,
• Gold $2,551 up $5.20,
• WTI crude oil settled at $76 down $1.73,
• 10-year U.S. Treasury 3.833 up 0.015 points,
• USD index $100.55 down $0.03,
• Bitcoin $61,990 down $809 or 1.29%,

*Stock data, cryptocurrency, and commodity prices at the market closing.

Today’s Highlights:

The US stock market experienced mixed trading on Tuesday, with the Dow Jones Industrial Average managing to secure another record close while the S&P 500 and Nasdaq Composite saw modest gains. Investors remained cautious ahead of Nvidia’s highly anticipated earnings report scheduled for Wednesday.

Key Factors Influencing the Market:

Nvidia Earnings Anticipation

Investors are eagerly awaiting Nvidia’s (NVDA) second-quarter earnings report, which is expected to be a significant market-moving event. The chipmaker’s results could have broader implications for the tech sector and the AI-driven rally that has propelled markets this year.Inflation UpdateMarket participants are also focused on the upcoming release of the PCE price index, the Federal Reserve’s preferred inflation gauge. This report could impact expectations for potential interest rate cuts in the near future.

Corporate News

Apple (AAPL) announced a change in its CFO position, with Kevan Parekh set to replace the long-standing executive whilst the Paramount (PARA) takeover saga appears to be nearing conclusion, with Skydance Media likely to secure a deal.

Analyst Insights

Kevin Mahn, chief investment officer at Hennion & Walsh, expressed optimism about Nvidia’s upcoming earnings report, stating, “I think they will once again exceed earnings expectations. They’ll exceed revenue expectations, and they’re going to announce substantial growth in their data center business”.As the market awaits Nvidia’s results, the company’s performance could have significant implications for the broader AI ecosystem and investor sentiment in the tech sector

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Click here to read our current Economic Forecast – August 2024 Economic Forecast: New Recession Flag

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Today’s Economic Releases Compiled by Steven Hansen, Publisher:

The S&P CoreLogic Case-Shiller 20-City Composite posted a year-over-year increase of 6.5% in June 2024, dropping from a 6.9% increase in the previous month. I do not hold out much hope there is a good solution to moderate home price inflation as overall it is not good for anyone except for flippers.

Richmond Fed Manufacturing Survey slowed in August 2024, according to the most recent survey from the Federal Reserve Bank of Richmond. The composite manufacturing index edged down from −17 in July to −19 in August. Of its three component indexes, shipments rose from −21 to −15, new orders decreased from −23 to −26, and employment fell from −5 to −15. Manufacturing is not doing well in the U.S.

The Conference Board Consumer Confidence Index® rose in August 2024 to 103.3 (1985=100), from an upwardly revised 101.9 in July. The Present Situation Index—based on consumers’ assessment of current business and labor market conditions—improved to 134.4 from 133.1 in July. Dana M. Peterson, Chief Economist at The Conference Board added:

Overall consumer confidence rose in August but remained within the narrow range that has prevailed over the past two years. Consumers continued to express mixed feelings in August. Compared to July, they were more positive about business conditions, both current and future, but also more concerned about the labor market. Consumers’ assessments of the current labor situation, while still positive, continued to weaken, and assessments of the labor market going forward were more pessimistic. This likely reflects the recent increase in unemployment. Consumers were also a bit less positive about future income. In August, confidence declined among consumers under 35 while it increased for those 35 and older. On a six-month moving average basis, confidence remained the highest among young consumers. Despite the overall improvement in the headline Index, confidence declined for consumers earning less than $25K. On a six-month moving average basis, consumers earning over $100K remained the most confident. Confidence among consumers earning $15K to $24.9K continued to trend down and was almost as low as for those earning less than $15K.

 

Here is a summary of headlines we are reading today:

• Iran Nuclear Deal ‘Off the Table,’ U.S. Affirms
• Norway’s Natural Gas Exports Surge in 2024
• Largest U.S Grid Faces Tough Test as Heat Wave Hits Midwest
• Goldman Sachs Cuts Its Expected Oil Price Range by $5
• Low Hydro Storage Forces New Zealand to Boost Fossil Fuel Power Generation
• Home prices hit record high in June on S&P Case-Shiller Index
• Nvidia has become world’s ‘most important stock,’ adding pressure to upcoming earnings report
• S&P 500, Nasdaq close slightly higher Tuesday, lifted by Nvidia shares: Live updates
• 2 people killed, 1 injured in reported tire explosion at Delta facility in Atlanta’s Hartsfield-Jackson airport
• Freezing your credit is the first step to avoid identity theft, expert says. Here’s what to know
• Solid 2Y Treasury Auction Prices At Lowest Yield In Two Years
• Lowe’s becomes latest company to back away from diversity plans

Click on the “Read More” below to access these, other headlines, and the associated news summaries moving the markets today.

Summary Of the Markets Today:

• The Dow closed up 65 points or 0.16%, (Closed at 41,241, New Historic high 41.420)
• Nasdaq closed down 0.85%,
• S&P 500 closed down 0.32%, (Closed at 5,617, New Historic high 5,652)
• Gold $2,555 up $8.50,
• WTI crude oil settled at $77 up $2.31,
• 10-year U.S. Treasury 3.820 up 0.013 points,
• USD index $100.90 up $0.19,
• Bitcoin $63,370 down $1,220 or 1.89%,

*Stock data, cryptocurrency, and commodity prices at the market closing.

Today’s Highlights:

US stocks ended mixed on Monday, with the Dow Jones Industrial Average reaching a new record high while the S&P 500 and Nasdaq Composite declined.  Key points from the session:

1. Technology stocks lagged, with semiconductor companies like Broadcom and Nvidia falling along with Tesla.
2. Investors are weighing the prospect of imminent interest rate cuts signaled by Fed Chair Jerome Powell last week against upcoming economic data and earnings reports.
3. Markets are pricing in rate cuts totaling 1% by the end of 2024, but uncertainty remains about the timing and magnitude.
4. Nvidia’s earnings report on Wednesday is seen as a crucial event that could impact market sentiment, especially regarding AI-related stocks.
5. Other important economic data coming this week include the PCE inflation index on Friday and Q2 GDP figures on Thursday.
6. Oil prices jumped about 3% due to production issues in Libya and escalating tensions in the Middle East.

The market’s performance reflects a mix of optimism about potential rate cuts and caution ahead of key economic data and earnings reports, particularly from the technology sector. The divergence between the Dow’s record high and declines in tech-heavy indexes highlights the current market dynamics.

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Click here to read our current Economic Forecast – August 2024 Economic Forecast: New Recession Flag

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Today’s Economic Releases Compiled by Steven Hansen, Publisher:

New orders for manufactured durable goods in July 2024 was up 1.3% year-over-year (0.2% inflation adjusted). This is up from last month’s -10.6% year-over-year. Not sure what happened in last month’s data to have this excessive decline, but the growth this month was across all sectors except for non-defense aircraft (Boeing). It is possible that the data one year ago had unusually high new orders.

The Dallas Fed’s Texas Manufacturing Outlook Survey exhibited little growth in August 2024. The production index, a key measure of state manufacturing conditions, inched up three points to 1.6, with the low reading signaling only slight growth in output from July. Most other measures of manufacturing activity continued to indicate declines this month, though they were less negative than in July. The new orders index climbed nine points to -4.2, and the capacity utilization index pushed up eight points to -2.5. The shipments index came in near zero, rebounding from -16.3 last month. Manufacturing remains a soft spot in today’s economy.

CoreLogic’s latest Single-Family Rent Index (SFRI) shows national year-over-year rent growth is returning to pre-pandemic rates as prices continue to hold steady. In June 2024, prices remained relatively stable, posting a 2.9% gain year-over-year. Although rental prices are growing slowly — this time last year, rent increases were 2.8% year over year — they continue their steady climb. Molly Boesel, principal economist for CoreLogic added:

Single-family rents have been bouncing around their pre-pandemic rate of growth of about 3% this year after growing by double digits for most of 2021 and 2022. At the end of 2023, they did slow to the mid-2% range. While single-family rents are increasing at a stable rate, median rent continues to rise and has increased over $300 over the past two years.

Here is a summary of headlines we are reading today:

• Looming Atlantic Current Collapse Threatens Northern Europe’s Climate
• EIA Reports Increase in U.S. EV Sales After Slowdown
• How Long Will Gold’s Record-Breaking Rally Last?
• Rate Cut Euphoria Fades as Oil Prices Jump 3.5%
• Canada Slaps 100% Import Tariff on Chinese EVs
• Oil Prices Soar as Geopolitical Risk Rises Rapidly
• Dow closes at record high, while tech stocks drag down S&P and Nasdaq: Live updates
• Telegram-linked crypto token plunges after CEO is arrested in France: CNBC Crypto World
• Dutch Gov’t Slaps Uber With Record $324 Million Fine For “Transferring Driver Data To US”
• Ikea trials resale website to rival eBay and Gumtree
• Treasury yields tick higher as traders wait for more clarity on Fed’s next move

Click on the “Read More” below to access these, other headlines, and the associated news summaries moving the markets today.

Summary Of the Markets Today:

• The Dow closed up 462 points or 1.14%, (Closed at 41,175, New Historic high 41.208)
• Nasdaq closed up 1.47%,
• S&P 500 closed up 1.15%,
• Gold $2,547 up $29.70,
• WTI crude oil settled at $75 up $1.88,
• 10-year U.S. Treasury 3.803 down 0.059 points,
• USD index $100.69 down $0.82,
• Bitcoin $63,644 up $3,261 or 5.40%,
• Baker Hughes Rig Count: U.S. -1 to 585 Canada +2 to 219

*Stock data, cryptocurrency, and commodity prices at the market closing.

Today’s Highlights:

Federal Reserve Chair Jerome Powell signaled that the time has come to begin cutting interest rates, reflecting confidence in the Fed’s fight against inflation. Markets reacted positively, with major stock indexes rising over 1% following Powell’s comments. Traders are pricing in a high likelihood of a rate cut in September, with debate over whether it will be 25 or 50 basis points. The 10-year Treasury yield fell to around 3.8%, near its lows for the year. Real estate stocks led gains in the S&P 500, rising 3.5% for the week as the best-performing sector.

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Click here to read our current Economic Forecast – August 2024 Economic Forecast: New Recession Flag

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Today’s Economic Releases Compiled by Steven Hansen, Publisher:

Federal Reserve Chair Jerome Powell’s Jackson Hole speech on Friday signaled a significant shift in the central bank’s focus, laying the groundwork for upcoming interest rate cuts. Here are the key points from his address:

Labor Market Focus

Powell emphasized the cooling labor market, mentioning labor conditions 27 times in his speech, compared to 19 times in last year’s address. This shift indicates that the Federal Open Market Committee is now paying closer attention to employment trends after two years of intense focus on inflation.

Readiness for Rate Cuts

The Fed Chair explicitly stated that “the time has come” to begin cutting interest rates. This clear message suggests that the central bank is preparing for a policy pivot in the near future.

Economic Outlook

Despite recent data revisions showing weaker job growth earlier in the year, Powell’s speech did not express serious concerns about an imminent recession or significant job losses. Instead, the focus seems to be on the diminishing threat of elevated wage growth keeping inflation too high.

Inflation Progress

Powell noted that inflation has significantly decreased from its peak, with the consumer price index declining from 9% in June 2022 to below 3% in July 2024. He highlighted the importance of anchored inflation expectations in facilitating disinflation without the need for economic slack.

Market Expectations

Following Powell’s speech, market expectations for a September rate cut remained high. However, the majority of traders anticipate a quarter-point (25 basis points) reduction, with some seeing a possibility of a larger half-point (50 basis points) cut.

Policy Approach

Powell emphasized the need for a careful approach, stating that the Fed is prepared to raise rates further if necessary but intends to hold policy at a restrictive level until confident that inflation is moving sustainably toward their 2% objective. In conclusion, Powell’s Jackson Hole speech marked a turning point in Fed policy, signaling a readiness to begin cutting interest rates while maintaining a cautious stance on inflation and closely monitoring labor market conditions.

Sales of new single-family houses in July 2024 were 6.6% above July 2023 – significantly better than the 9.0% last month. The median sales price of new houses sold in July 2024 was $429,800. The average sales price was $514,800. The seasonally-adjusted estimate of new houses for sale at the end of July was 462,000. This represents a supply of 7.5 months at the current sales rate. Sales of new homes has been relatively good since the 2Q2023.

 

Here is a summary of headlines we are reading today:

• $1 Trillion LNG Infrastructure Boom Threatens Climate Goals
• U.S. Oil, Gas Drilling Activity Declines
• The Time Has Come For Rate Cuts… and Higher Oil Prices
• Oil Jumps 2% During Fed Jackson Hole Meeting
• California Taxpayers to Foot $8.5 Billion Bill for Rooftop Solar Subsidies
• Dow closes more than 450 points higher as Powell signals Fed rate cuts are coming: Live updates
• Markets are now wondering whether the Fed might cut by half a point in September
• 10-year Treasury yield slides after Powell remarks point to Fed rate cuts
• Bitcoin rises after Fed Chair Powell lays groundwork for interest rate cuts: CNBC Crypto World
• Stocks making the biggest moves midday: Cava, Intuit, Ross Stores, Workday and more
• America’s Power Grid Adds Most Generating Capacity In 21 Years As AI Data Center Demand Surges
• WazirX security breach: Crypto platform to resume INR withdrawals in phases starting August 26

Click on the “Read More” below to access these, other headlines, and the associated news summaries moving the markets today.

Summary Of the Markets Today:

• The Dow closed down 178 points or 0.43%, (Closed at 40,713, New Historic high 41.027)
• Nasdaq closed down 1.67%,
• S&P 500 closed down 0.89%, (Closed at 5,571, New Historic high 5,643)
• Gold $2,518 down $29.40,
• WTI crude oil settled at $73 up $0.95,
• 10-year U.S. Treasury 3.862 up 0.086 points,
• USD index $101.53 up $0.49,
• Bitcoin $60,314 down $657 or 1.07%,

*Stock data, cryptocurrency, and commodity prices at the market closing.

Today’s Highlights:

U.S. stocks declined on Thursday, with technology stocks leading the losses as investors turned their attention to Federal Reserve Chair Jerome Powell’s upcoming speech at the Jackson Hole symposium on Friday.  Market Dynamics: The market’s focus has shifted to the Fed’s Jackson Hole symposium, which began on Thursday. Investors are particularly interested in any potential changes in tone from policymakers during Powell’s speech on Friday. This comes after minutes from the Fed’s last meeting revealed that several officials were open to a July rate cut, suggesting a possible pivot in next month’s policy decision. Economic Data: New data from the Department of Labor showed 232,000 initial jobless claims for the week ending August 17, slightly up from the previous week and in line with economists’ expectations. This data has gained increased attention following an official revision to payrolls that indicated the labor market may have been cooling earlier than initially thought. Rate Cut Expectations: Market expectations for interest rate cuts have been fluctuating. While there were earlier hopes for a 0.5% reduction, recent developments have tempered these expectations. Currently, markets are pricing in just a 25% chance of a 50 basis point cut at the Fed’s September meeting, down from 38% the previous day.The upcoming speech by Powell at Jackson Hole is highly anticipated, as investors look for any signals that might contradict or confirm the market’s current optimistic outlook on rate cuts.

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Click here to read our current Economic Forecast – August 2024 Economic Forecast: New Recession Flag

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Today’s Economic Releases Compiled by Steven Hansen, Publisher:

The Chicago Fed National Activity Index (CFNAI) three-month moving average, CFNAI-MA3, was unchanged at –0.06 in July 2024 which implies the economy is not recessionary but is in the neighborhood of weak expansion. Twenty-eight of the 85 individual indicators made positive contributions to the CFNAI in July, while 57 made negative contributions. Thirty-one indicators improved from June to July, while 53 indicators deteriorated and one was unchanged. Of the indicators that improved, 12 made negative contributions.

Existing-home sales improved in July 2024 but year-over-year sales fell 2.5%. Total housing inventory was up 19.8% from one year ago with unsold inventory sits at a 4.0-month supply at the current sales pace, down from 4.1 months in June but up from 3.3 months in July 2023. The median existing-home price for all housing types in July was $422,600, up 4.2% from one year ago ($405,600). Note that existing home sales are not a component of GDP.  NAR Chief Economist Lawrence Yun added:

Despite the modest gain, home sales are still sluggish. But consumers are definitely seeing more choices, and affordability is improving due to lower interest rates.

The Kansas City Fed’s manufacturing activity declined less in August 2024 than in July. The month-over-month composite index was -3 in August, up from -13 in July and -8 in June . Manufacturing remains the soft spot in the current economy.

In the week ending August 17, the advance figure for seasonally adjusted initial unemployment claims 4-week moving average was 236,000, a decrease of 750 from the previous week’s revised average. The previous week’s average was revised up by 250 from 236,500 to 236,750. There is no indication in unemployment numbers that a recession is in view.

Here is a summary of headlines we are reading today:

• Oil Buying Opportunity May Have Arrived: Citi
• Is China’s Steel Industry on the Brink of a Major Crisis?
• Experts Skeptical of Lasting Cease-Fire Between Israel and Hamas
• Global Offshore Wind Installations to Surpass 520 GW by 2040
• Ford’s $5 Billion EV Loss Sparks Strategic Shift Towards Hybrids
• Fed Minutes Signal September Rate Cut
• Stocks close lower, Nasdaq slides 1% as Treasury yields rise and Powell speech looms: Live updates
• Peloton shares soar 35% as turnaround plan takes hold, losses shrink
• FDA approves updated Pfizer, Moderna Covid vaccines as virus surges; shots to be available within days
• Philadelphia Fed President Harker advocates for interest rate cut in September
• Stocks making the biggest moves midday: Urban Outfitters, Peloton, Advance Auto Parts and more
• ‘No Israeli Withdrawal, No Ceasefire Deal’: Hamas
• Treasury yields jump by most in at least a week after fresh data ease near-term recession concerns
• Is the August stock-market volatility behind us? This key indicator says not yet.

Click on the “Read More” below to access these, other headlines, and the associated news summaries moving the markets today.

Summary Of the Markets Today:

• The Dow closed up 56 points or 0.14%, (Closed at 40,890, New Historic high 40.974)
• Nasdaq closed up 0.57%,
• S&P 500 closed up 0.42%, (Closed at 5,621, New Historic high 5,633)
• Gold $2,550 down $0.60,
• WTI crude oil settled at $72 down $1.22,
• 10-year U.S. Treasury 3.801 down 0.017 points,
• USD index $101.19 down $0.25,
• Bitcoin $61,550 up $2,528 or 4.28%,

*Stock data, cryptocurrency, and commodity prices at the market closing.

Today’s Highlights:

U.S. stocks closed higher on Wednesday, marking a rebound after breaking their longest winning streak of the year. This upward movement came as investors analyzed the Federal Reserve’s latest meeting minutes, which indicated that most officials support a potential rate cut in September if inflation continues to decline. The market’s focus has shifted towards the labor market’s impact on Fed policy, especially as new data revealed that the U.S. economy had 818,000 fewer jobs than previously reported as of March 2024. Despite this adjustment, economists noted that the labor market is softening but not in a state of rapid decline. Investors remain cautious ahead of Federal Reserve Chair Jerome Powell’s upcoming speech at the Jackson Hole symposium, with heightened expectations for a September rate cut. In corporate news, Target’s shares surged over 11% after reporting earnings that exceeded Wall Street expectations, while Macy’s shares fell nearly 13% following a sales decline. Overall, the S&P 500 is now less than 1% away from its all-time high, reflecting a broader recovery trend in the market.

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Click here to read our current Economic Forecast – August 2024 Economic Forecast: New Recession Flag

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Today’s Economic Releases Compiled by Steven Hansen, Publisher:

The Bureau of Labor Statistics (BLS) has benchmarked the establishment survey with the results released today. These revised counts are derived from state unemployment insurance (UI) tax records that nearly all employers are required to file. This had lead to significant downward revisions to previously reported employment gains, indicating a slower job growth than initially estimated. My take on  this revision

Major Revision Details

The BLS revised job gains downward by 818,000 for the 12-month period ending in March 2024. This substantial adjustment represents a reduction of 0.5% of total employment from April 2023 to March 2024.

Sector-Specific Impacts

The revision affected various sectors differently:

• • Professional and business services saw the largest absolute decrease, with 358,000 fewer jobs than previously reported.
  • Leisure and hospitality followed with a reduction of 150,000 jobs.
  • The information sector experienced the most significant percentage decline at 2.3%.

Economic Implications

This revision has several implications for the economy:

1. 1. It suggests that job growth was slower than initially thought, with approximately 2.1 million jobs created in the year ending March 2024.
   2. The unemployment rate has remained relatively stable at around 4%, despite the downward revision.
   3. The revision has added to concerns about a potential economic slowdown.
   4. It has sparked discussions about whether the Federal Reserve should have considered cutting interest rates sooner.

The Federal Reserve today released the minutes of the Federal Open Market Committee for the meetings held on July 30–31, 2024. There seems to be a sense when reading the minutes, that the Federal Reserve is close to reducing the federal funds rate by 25 basis points – likely at their next meeting. Highlights of the minutes:

Participants observed that inflation had eased over the past year but remained elevated and that, in recent months, there had been some further progress toward the Committee’s 2 percent inflation objective … participants judged that recent data had increased their confidence that inflation was moving sustainably toward 2 percent. Almost all participants observed that the factors that had contributed to recent disinflation would likely continue to put downward pressure on inflation in coming months … 

Participants assessed that supply and demand conditions in the labor market had continued to come into better balance. The unemployment rate had moved up but remained low, having risen 0.7 percentage point since its trough in April 2023 to 4.1 percent in June … Regarding the outlook for the labor market, participants discussed various indicators of layoffs, including initial claims for unemployment benefits and measures of job separations. Some participants commented that these indicators had remained at levels consistent with a strong labor market …

participants observed that consumer spending had slowed from last year’s robust pace, consistent with restrictive monetary policy, easing of labor market conditions, and slowing income growth. They noted, however, that consumer spending had still grown at a solid pace in the first half of the year, supported by the still-strong labor market and aggregate household balance sheets … 

Participants discussed the risks and uncertainties around the economic outlook. Upside risks to the inflation outlook were seen as having diminished, while downside risks to employment were seen as having increased. Participants saw risks to achieving the inflation and employment objectives as continuing to move into better balance, with a couple noting that they viewed these risks as more or less balanced … 

Some participants observed that the banking system was sound but noted risks associated with unrealized losses on securities, reliance on uninsured deposits, and interconnections with nonbank financial intermediaries … Participants generally noted that some banks and nonbank financial institutions likely have vulnerabilities associated with high CRE exposures through loan portfolios and holdings of CMBS … 

In their consideration of monetary policy at this meeting, participants observed that recent indicators suggested that economic activity had continued to expand at a solid pace, job gains had moderated, and the unemployment rate had moved up but remained low. While inflation remained somewhat above the Committee’s longer-run goal of 2 percent, participants noted that inflation had eased over the past year and that recent incoming data indicated some further progress toward the Committee’s objective. All participants supported maintaining the target range for the federal funds rate at 5-1/4 to 5-1/2 percent, although several observed that the recent progress on inflation and increases in the unemployment rate had provided a plausible case for reducing the target range 25 basis points at this meeting or that they could have supported such a decision … 

Many participants noted that reducing policy restraint too late or too little could risk unduly weakening economic activity or employment. A couple participants highlighted in particular the costs and challenges of addressing such a weakening once it is fully under way. Several participants remarked that reducing policy restraint too soon or too much could risk a resurgence in aggregate demand and a reversal of the progress on inflation. These participants pointed to risks related to potential shocks that could put upward pressure on inflation or the possibility that inflation could prove more persistent than currently expected.

Here is a summary of headlines we are reading today:

• Investors Are Flocking to Gold
• EU Slashes Proposed Tariffs on Tesla’s China-Made EVs
• Nigeria’s Massive Dangote Refinery Taking Less American Crude
• Will Buffett Step in to Keep Occidental Afloat?
• Oil Ticks Higher as EIA Reports Inventory Draws Across the Board
• Texas Faces Growing Electricity Needs
• Fed minutes point to ‘likely’ rate cut coming in September
• Nonfarm payroll growth revised down by 818,000, Labor Department says
• U.S. job growth revised down by the most since 2009. Why this time is different
• Epic Systems is building more than 100 new AI features for doctors and patients. Here’s what’s coming
• ‘The Descent Is Upon Us’: Forget The Sahm Rule, This Indicator Has Perfectly Predicted Every US Recession Since 1930
• Red-hot rent rises cool but tenants still struggling

Click on the “Read More” below to access these, other headlines, and the associated news summaries moving the markets today.

Summary Of the Markets Today:

• The Dow closed down 62 points or 0.15%, (Closed at 39,835, New Historic high 40.909)
• Nasdaq closed down 0.33%,
• S&P 500 closed down 0.20%, (Closed at 5,597, New Historic high 5,621)
• Gold $2,523 up $11.30,
• WTI crude oil settled at $74 down $0.55,
• 10-year U.S. Treasury 3.818 down 0.049 points,
• USD index $101.41 down $0.48,
• Bitcoin $59,498 up $46 or 0.08%,

*Stock data, cryptocurrency, and commodity prices at the market closing.

Today’s Highlights:

Markets experienced a pause on Tuesday, marking the end of their longest rally this year, as all three major indexes closed lower. The S&P 500 concluded an eight-day streak of gains – the longest since November. Investor attention is now shifting towards Federal Reserve Chair Jerome Powell’s upcoming speech at the Jackson Hole Economic Symposium later this week. This event is anticipated to provide insights into potential interest rate cuts, with many expecting Powell to signal a September reduction amid recent positive economic data that supports easing monetary policy. Analysts speculate that a modest cut of 0.25% is likely, while some suggest a more significant 0.5% reduction could be on the table, depending on future labor market reports.In corporate news, Lowe’s saw its stock decline after the company revised its annual profit and sales forecasts downward, reflecting weaker consumer demand for large purchases. In contrast, gold prices continued to rise, surpassing $2,520 per ounce, driven by geopolitical tensions and the prospect of lower interest rates enhancing its appeal as a safe-haven asset.

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Click here to read our current Economic Forecast – August 2024 Economic Forecast: New Recession Flag

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Today’s Economic Releases Compiled by Steven Hansen, Publisher:

no releases today

Here is a summary of headlines we are reading today:

• Negative Power Prices Hit Europe as Renewable Energy Floods the Grid
• Lithium Market Potential: Evaluating Supply and Demand Dynamics
• China’s Coal Production Surges to Meet Energy Demands
• Oil Prices Fall As Middle East Worries Ease
• Traders Look for Bullish Cues Ahead of Crucial Fed Meeting
• S&P 500, Nasdaq snap eight-day winning streak as rebound rally pauses: Live updates
• Wyoming blockchain summit kicks off ahead of Fed’s Jackson Hole meeting: CNBC Crypto World
• Morgan Stanley International chair among 6 missing after luxury yacht sinks in Sicily
• General Atlantic set to sell up to 5.1% stake in PNB Housing via open market on Wednesday
• Cyient to sell 14.5% stake in arm Cyient DLM via block deal on Wednesday

Click on the “Read More” below to access these, other headlines, and the associated news summaries moving the markets today.

Summary Of the Markets Today:

• The Dow closed up 237 points or 0.58%, (Closed at 39,896, New Historic high 40.907)
• Nasdaq closed up 1.39%,
• S&P 500 closed up 0.97%, (Closed at 5,559, New Historic high 5,603)
• Gold $2,543 up $5.70,
• WTI crude oil settled at $74 down $2.23,
• 10-year U.S. Treasury 3.875 down 0.017 points,
• USD index $101.88 down $0.59,
• Bitcoin $58,897 up $459 or 0.79%,

*Stock data, cryptocurrency, and commodity prices at the market closing.

Today’s Highlights:

US stocks experienced a strong rally on Monday, closing at session highs and marking their best week in a year.

Key Drivers of the Rally:

• Technology and Consumer Discretionary Stocks: These sectors led the gains, with the S&P 500 achieving its longest winning streak since November, now at eight consecutive days. Notably, Nvidia and Tesla saw significant increases in their stock prices, contributing to the Nasdaq’s performance.
• Market Recovery: This upswing follows a period of volatility earlier in August, where concerns about a potential recession had led to a sell-off. Recent data indicating improved inflation and consumer spending have helped ease these fears.

Economic Outlook:

Investor sentiment is shifting towards optimism regarding the economy, with Goldman Sachs reducing its recession forecast from 25% to 20% over the next year. There is growing speculation about the Federal Reserve’s next moves, with traders anticipating a 72% chance of a 0.25% interest rate cut in September.

Upcoming Events: 

Attention is now focused on Fed Chair Jerome Powell’s upcoming speech at the Jackson Hole symposium, which could provide further insights into monetary policy. Additionally, the Democratic National Convention is underway, potentially influencing political and economic expectations.Overall, the stock market’s recent performance reflects a recovery from earlier losses and a more stable outlook for the economy.

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Click here to read our current Economic Forecast – August 2024 Economic Forecast: New Recession Flag

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Today’s Economic Releases Compiled by Steven Hansen, Publisher:

The Conference Board Leading Economic Index® (LEI) for the U.S. fell by 0.6 percent in July 2024 to 100.4 (2016=100), following a decline of 0.2 percent in June. Over the six-month period ending in July 2024, the LEI fell by 2.1 percent, a smaller rate of decline than its −3.1 percent over the six-month period between July 2023 and January 2024. Justyna Zabinska-La Monica, Senior Manager, Business Cycle Indicators, at The Conference Board perspective:

The LEI continues to fall on a month-over-month basis, but the six-month annual growth rate no longer signals recession ahead. In July, weakness was widespread among non-financial components. A sharp deterioration in new orders, persistently weak consumer expectations of business conditions, and softer building permits and hours worked in manufacturing drove the decline, together with the still-negative yield spread. These data continue to suggest headwinds in economic growth going forward. The Conference Board expects US real GDP growth to slow over the next few quarters as consumers and businesses continue cutting spending and investments. US real GDP is expected to expand at a pace of 0.6 percent annualized in Q3 2024 and 1 percent annualized in Q4.

Here is a summary of headlines we are reading today:

• Aluminum Prices Continue to Slide
• WTI Sheds Nearly 3% as China Demand Dulls
• Russian Oil Depot Fire Rages on After Ukraine Drone Attack
• A Strong HODLing Trend Emerges in Bitcoin
• U.S. Gasoline Prices Fall to Lowest Since March, Diesel Hits Multi-Year Lows
• Colombia Bans Coal Exports to Israel
• S&P 500, Nasdaq post eighth positive session as stocks extend their winning run: Live updates
• SEC charges Carl Icahn with hiding billions in loans backed by IEP stock
• Import Volumes Surge At Nation’s Busiest West Coast Ports Amid Strike & Global Trade War Fears
• Energy prices forecast to rise by 9% in October
• Nvidia’s stock is up 30% from August lows — and earnings could further its momentum
• Treasury yields hold in narrow range as investors await Fed’s Jackson Hole conference
• The Fed’s big hole en route to Jackson Hole: getting out of its own way

Click on the “Read More” below to access these, other headlines, and the associated news summaries moving the markets today.

Summary Of the Markets Today:

• The Dow closed up 97 points or 0.24%,
• Nasdaq closed up 0.21%,
• S&P 500 closed up 0.20%,
• Gold $2,546 up $53.00,
• WTI crude oil settled at $77 down $1.44,
• 10-year U.S. Treasury 3.883 down 0.043 points,
• USD index $102.44 down $0.54,
• Bitcoin $59,665 up $2,114 or 3.67%,
• Baker Hughes Rig Count: U.S. -2 to 586 Canada unchanged at 217

*Stock data, cryptocurrency, and commodity prices at the market closing.

Today’s Highlights:

Stocks End in the Green: On Friday, the S&P 500 and Nasdaq Composite closed modestly higher, securing their best week of the year. Consumer Sentiment and Economic Data: The main economic data release on Friday showed an increase in consumer sentiment in August, marking the first rebound in five months. This positive sentiment, along with strong retail sales and Walmart’s earnings report, helped alleviate recession fears. Federal Reserve Rate Cut Expectations: Following the positive economic data, investors adjusted their expectations for Federal Reserve rate cuts. The odds of a 0.25% rate cut next month are now at 66%, while a 0.50% cut stands at 33%. This is a shift from the previous near-certainty of a 0.50% cut amid market turbulence. Upcoming Federal Reserve Update: Investors are looking ahead to next Friday when Fed Chair Jay Powell will speak at the annual Jackson Hole Symposium, which could provide further insights into the Fed’s monetary policy direction.

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Click here to read our current Economic Forecast – August 2024 Economic Forecast: New Recession Flag

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Today’s Economic Releases Compiled by Steven Hansen, Publisher:

Privately-owned housing units authorized by building permits in July 2024 was 7.0% below July 2023 rate. Privately-owned housing starts 16.0% below July 2023. Privately-owned housing completions was 13.8 % above July 2023 rate. Let’s put these numbers in perspective: permits, starts and completions are on the high side for the period since the 2007 Great Recession. So whilst the umbers are lower than the previous months – they are still economically positive.

Here is a summary of headlines we are reading today:

• China’s Steel Industry Braces for Painful Consolidation
• U.S. Oil and Gas Rig Count Falls for Second Week
• China and Saudi Arabia Emerge as Largest Buyers of Russia’s Fuel Oil
• Red Sea Ship Detours Boost Fuel Consumption by 500,000 Bpd
• A Review of Geopolitical Risk in Russia and the Middle East
• Stocks close higher Friday as market comeback lifts S&P 500 to best week of 2024: Live updates
• The 60/40 portfolio excelled during the market storm — and Vanguard sees a strong decade ahead
• Cadillac reveals new ‘Opulent Velocity’ performance EV concept
• Ford upgrades Lincoln Navigator to include spa mode, 48-inch display for videos and gaming
• Bayer shares soar 11% after key U.S. legal win against Roundup cancer claims
• Gold Price Today: Yellow metal jumps by Rs 1,200/10 gram, silver dearer by Rs 2,500/kg. Here’s why
• Treasury yields finish mostly lower following big spike on Thursday

Click on the “Read More” below to access these, other headlines, and the associated news summaries moving the markets today.

Summary Of the Markets Today:

• The Dow closed up 555 points or 1.39%,
• Nasdaq closed up 2.34%,
• S&P 500 closed up 1.61%,
• Gold $2,493 up $13.30,
• WTI crude oil settled at $78 up $1.00,
• 10-year U.S. Treasury 3.919 up 0.097 points,
• USD index $103.03 up $0.46,
• Bitcoin $57,053 down $1,637 or 2.79%,

*Stock data, cryptocurrency, and commodity prices at the market closing.

Today’s Highlights:

Stocks surged on Thursday as Wall Street reacted to positive signals regarding the U.S. consumer and labor market. Key factors influencing the market included Walmart’s earnings report, government retail sales data, and jobless claims updates. Walmart’s Performance: Walmart’s stock jumped over 6% following a strong earnings report that exceeded expectations for both earnings and revenue. The company also raised its full-year outlook, projecting sales growth between 3.75% and 4.75% and adjusted earnings per share between $2.35 and $2.43. Retail Sales and Jobless Claims: Retail sales for July rose by 1%, significantly surpassing Wall Street’s 0.4% estimate, indicating a resilient U.S. consumer base. Additionally, weekly jobless claims fell to 227,000, defying expectations of an increase and contributing to the positive market sentiment. Market Recovery: After a challenging start to August, stocks have rebounded, driven by cooling recession fears. The S&P 500 and Nasdaq have recovered from earlier losses, with the S&P 500 up nearly 7% and the Nasdaq more than 8% since the sell-off on August 5. The Information Technology sector, led by companies like Nvidia, has been a significant driver of this recovery.

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Click here to read our current Economic Forecast – August 2024 Economic Forecast: New Recession Flag

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Today’s Economic Releases Compiled by Steven Hansen, Publisher:

Industrial production fell to -0.2% year-over-year in July 2024 – down from 1.1% gain year-over-year in June. Components manufacturing was up 0.1% year-over-year (down from 0.6%), utilities declined 0.1% year-over-year (down from 7.9%), and mining declined 1.5% year-over-year (from -1.2% in June).  Capacity utilization moved down to 77.8 percent in July, a rate that is 1.9 percentage points below its long-run (1972–2023) average. The authors claim that Hurricane Beryl impacted industrial production by 0.3% which seems to ring true. However, these are not numbers that I would be bragging about as they indicate a very weak industrial sector. Note that the problem is not only in the U.S. as China’s factory output slowed for a third straight month in July.

The August 2024 Philly Fed Manufacturing Business Outlook Survey shows that manufacturing activity in the region softened overall. The survey’s indicators for current general activity, new orders, and shipments all declined, with the former turning negative. The employment index suggests declines in employment overall. The diffusion index for current general activity fell from 13.9 to -7.0, its first negative reading since January. The indexes for new orders and shipments also declined but remained positive for the second consecutive month: The new orders index decreased 6 points to 14.6, and the shipments index fell 19 points to 8.5. Poor growth data in the manufacturing sector continues. 

Business activity edged slightly lower according to the August 2024 New York Fed Empire State Manufacturing Survey. The headline general business conditions index was little changed at -4.7. New orders declined modestly, while shipments held steady. There is little good news in the manufacturing sector.

Job seekers’ relocating for new jobs rose to 2.7% in the second quarter, up from 2.1% in the first quarter* and 2.4% in the same quarter last year. While the rate is rising after falling to historic lows in 2023, it is still not at levels seen pre-pandemic. Andrew Challenger, Senior Vice President and economic expert for Challenger, Gray & Christmas added:

The rise in the relocation rate suggests finding jobs close to home is becoming a bit more difficult. With more companies mandating time in the office, job seekers are beginning to recognize the need to move to where the jobs are.

Prices for U.S. imports ticked up to 1.6% year-over-year in July 2024 from 1.5% the previous month. Export prices likewise rose from 1.0% year-over-year in June to 1.4% in July. Import price increases affect retail prices.

Retail trade sales were up 2.6% year-over-year in July 2024 – and increase from June’s flat sales. Nonstore retailers were up 6.7 percent (±1.4 percent) from last year, while food services and drinking places were up 3.4 percent (±2.1 percent) from July 2023. The data in many sectors was weak but the non-store retailers (say Amazon) were the bright spot of this report. However, I was personally surprised by the strength of this data – and this should work against those who believe the economy is weakening and therefore the Fed should cut the federal funds rate.

In the week ending August 10, the advance figure for seasonally adjusted initial unemployment claims 4-week moving average was 236,500, a decrease of 4,500 from the previous week’s revised average. The previous week’s average was revised up by 250 from 240,750 to 241,000. There is little indication in unemployment claims that the economy is weakening.

Here is a summary of headlines we are reading today:

• Russia Expands ‘Dark Fleet’ to Evade LNG Sanctions
• The Real Reason Iran Hasn’t Retaliated Against Israel
• Supply Chain Woes Worsen After Chinese Port Closure
• Oil Prices Climb 2% as Gaza Ceasefire Talks Begin
• U.S. Set to Slowly Refill SPR as Crude Buys Extend Into 2025
• Stocks close higher, S&P 500, Nasdaq notch six-day winning streak as comeback rally gains steam: Live updates
• Ex-Google CEO Eric Schmidt sees Nvidia as big AI winner: ‘You know what to do in the stock market’
• Here’s the deflation breakdown for July 2024 — in one chart
• Meta CEO Mark Zuckerberg receives letter from lawmakers concerned about illicit drug ads on Facebook and Instagram
• Walmart says prices are coming down — except in one key area
• US Inflation falls to 3-year low, clearing the way for Fed to begin cutting rates
• 2-year Treasury yield jumps by most in 4 months on positive retail-sales data

Click on the “Read More” below to access these, other headlines, and the associated news summaries moving the markets today.