Crude Oil Continues to Surge – Market Recap Sep 8
Indices
- Dow 34,576, -261 or -0.75%.
- Nasdaq 13,761, -270 or –1.92%.
- MSCI EAFE 2074.02, -30 or -1.43%.
- S&P 4,457, -58 or -1.28%.
- USD10Y 4.258%, +8.5bp or +2.03%.
- WTI Crude $87.23/bbl, +$1.18 or +1.37%.
Crude Continues to Surge
Crude oil took another step up this week on the back of news that Saudi Arabia and Russia will both extend their voluntary production cuts through the end of the year. National gasoline prices have held steady but any increase in prices at the pump will be inflationary in nature and another data point to consider when the Fed meets next week.
Other than the production cuts out of the Middle East, it was a relatively slow week. The services sector continues to show resiliency and both indices are in expansion territory. Multiple Fed officials spoke and parroted the same line: that while the data is encouraging and probably deserving of a rate hike pause this meeting, additional data demonstrating that inflation is on the wane will be needed to convince the committee that the fight against rising prices has been won.
Next Week
This week brings more inflation data in the form of retail and wholesale prices (the Consumer Price Index and the Producer Price Index respectively). These will also be the last major data points on prices the Fed receives prior to their meeting next week, September 19-20. In addition, two large tech companies report earnings (ORCL and ADBE) and we get another look at manufacturing in New York.
Economic Calendar
- Monday – N/A. Earnings: Oracle (ORCL).
- Tuesday – N/A.
- Wednesday – August Consumer Price Index (CPI).
- Thursday – Initial Jobless Claims. August Producer Price Index (PPI), August U.S. Retail Sales. Earnings: Adobe (ADBE).
- Friday – September Empire State Manufacturing. Preliminary August Consumer Sentiment.
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Sep 8 Daily Trading Recap…
Monday – Market Closed in Observance of Labor Day.
Tuesday – Dow -195 to 34,641, Nasdaq -10 to 14,020, S&P -18 to 4,496, USD10Y +9.5bp to 4.268%.
- Eight of eleven S&P sectors traded lower, led by Materials, Industrials, and Utilities.
- The market fell today on news that Saudi Arabia and Russia will extend their crude oil production cuts through the end of the year.
Wednesday – Dow -198 to 34,443, Nasdaq -148 to 13,872, S&P -31 to 4,465, USD10Y +2.2bp to 4.290%
- Nine of eleven S&P sectors traded down, led lower by Technology, Consumer Discretionary, and Health Care.
- Final August U.S. Services numbers were mixed while still demonstrating expansion; S&P Services PMI missed slightly at 50.5 vs 51 expected and vs July’s 51 print. The ISM Index was better, reporting 54.5% vs 51% expected and vs July’s 52.7%.
- Boston Federal Reserve President Susan Collins said the Fed can take a cautious approach regarding future rate hikes but warned that while the current data is good, that it is too early to declare the fight against inflation won.
Thursday – Dow +57 to 34,500, Nasdaq -123 to 13,748, S&P -14 to 4,451, USD10Y -3.5bp to 4.26%.
- Six of eleven S&P sectors traded higher, led by Utilities, Real Estate, and Consumer Discretionary.
- Jobless claims fell for the fourth consecutive week to 216,000 vs the 234,000 forecast and last week’s revised higher print of 229,000 (originally 228,000).
- Multiple Fed officials spoke today and repeated the party line that while a pause at the next meeting seems appropriate, additional data is needed before the fight against inflation and its accompanying rate hikes can be declared over.
Friday – Dow +75 to 34,576, Nasdaq +12 to 13,761, S&P +6 to 4,457, USD10Y -0.2bp to 4.258%.
- Eight of the eleven S&P sectors traded higher, led by Energy, Utilities, and Communication Services.
If you know of any friends or family members who could benefit from our services and these types of communiques during these unique times, we are accepting new clients and offer a complimentary one-hour review.
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