Rate Cut Ahoy! – Sep 13 Market Recap

Rate Cut Ahoy! – Sep 13 Market Recap

Indices 

• Dow 41,393, +1,048 or +2.60%.  
• Nasdaq 17,683, +993 or +5.95%. 
• S&P 5,626 +218 or +4.03%. 
• MSCI EAFE 2410.81, +27.8 or +1.17%. 
• USD10Y 3.65%, -6.0bp or -1.62%. 
• WTI Crude $69.24 bbl, +$0.59 or +0.89%.

Rate Cut Ahoy! 

There are a few economic data points this week; East Coast manufacturing numbers and U.S. Retail Sales the headliners. However, all focus will be on the Federal Reserve’s interest rate cut decision on Wednesday. Market observers give a slight edge to the Fed cutting 50bp vs 25bp (52% vs 48%).  

Amongst that backdrop saw a solid week of gains in the markets with both the S&P 500 and the Nasdaq posting their strongest showings of the year and the former closing within 1% of its all-time high. Inflation data was mixed, with both headline CPI and PPI declining while the Core (ex-food and energy) numbers rose slightly. Jobless claims were within an acceptable range of expectations and didn’t move the market (nor should they given their weekly volatility).  

And so, the stage is set; will good news beget a market rally to new highs or will investors sell the news? Will a 50bp cut inspire greed or produce paranoia that the Fed has insight into a forthcoming recession that the markets cannot yet foresee?  

The Upcoming Week: Sep 16 – Sep 20 

Economic Calendar 

• Monday – September Empire State Manufacturing. 
• Tuesday – August U.S. Retail Sales. 
• Wednesday – FOMC Interest Rate Decision, Fed Chair Powell press conference. Earnings: General Mills (GIS). 
• Thursday – Initial Jobless Claims, September Philadelphia Fed Manufacturing Survey. Earnings: FedEx (FDX). 
• Friday – N/A.

If you know of any friends or family members who could benefit from our services and these types of communiques, we are accepting new clients and offer a complimentary one-hour review. 

Last Week‘s Daily Trading Recap… 

Monday – Dow +484 to 40,829, Nasdaq +193 to 16,884, S&P +62 to 5,471, USD10Y -1.3bp to 3.697% 

• All eleven S&P sectors traded higher today, led by Consumer Discretionary, Industrials, and Technology. 
• Oracle (ORCL) beat both their top and bottom–line estimates and popped +13% post close. 

Tuesday – Dow -92 to 40,736, Nasdaq +141 to 17,025, S&P +24 to 5,495, USD10Y -5.1bp to 3.646% 

• Nine of eleven S&P sectors traded higher today, led by Real Estate, Consumer Discretionary, and Technology.  

Wednesday – Dow +38 to 40,974, Nasdaq -52 to 17,084, S&P -8 to 5,520, USD10Y -7.6bp to 3.768%. 

• Six of eleven S&P sectors traded higher today, led by Technology, Consumer Discretionary and Communication Services. 
• The August Consumer Price Index (CPI) was up +0.2%, in line with expectations and unchanged from last month. Year-over-year CPI fell to +2.5% vs +2.6% expected and vs last month’s +2.9% print. 
• August Core CPI was up +0.3% vs +0.2% expected and vs +0.2% last month. Year-over-year Core CPI rose to +3.3% vs +3.2% expected and vs last month’s +3.2% print. 

Thursday – Dow +235 to 41,096, Nasdaq +174 to 17,569, S&P +41 to 5,595, USD10Y +2.7bp to 3.68%. 

• All eleven S&P sectors traded higher today, led by Communication Services, Consumer Discretionary, and Energy. 
• Jobless claims fell to 230,000 vs 227,000 forecast and vs. last week’s slightly revised higher print of 228,000 (originally 227,000). 
• The August Producer Price Index (PPI) increased to +0.2% vs expectations of an increase of +0.2% and vs last month’s +0.0% print. Year-over-year PPI fell to +1.7% vs last month’s +2.1% print. 
• Core August PPI increased to +0.3% vs expectations of an increase of +0.2%. Year-over-year Core PPI increased to +2.4% vs last month’s +2.3% print. 
• Earnings: Kroger (KR) beat earnings but missed their revenue estimates and traded up +7.18%. Adobe (ADBE) beat top and bottom-line expectations but issues soft guidance and traded down -9.47% post close.

Friday – Dow +296 to 41,393, Nasdaq +114 to 17,683, S&P +30 to 5,626, USD10Y -3.0bp to 3.65%. 

• All eleven S&P sectors traded higher today, led by Utilities, Communication Services, and Industria 
• Boeing (BA) fell -3.69% after their factory workers went on strike today. 

If you know of any friends or family members who could benefit from our services and these types of communiques, we are accepting new clients and offer a complimentary one-hour review.  

Disclaimer: This is not a recommendation to buy or sell any of the securities listed above. I personally, or a family member whose account I control, have positions in the following securities/assets…Bitcoin, Cardano, Chainlink, Ethereum, ACHR, AVGO, and BITB.