Traders work on the floor of the New York Stock Exchange during morning trading on August 12, 2024 in New York City.
Michael M. Santiago | Getty Images News | Getty Images
This report is from today’s CNBC Daily Open, our international markets newsletter. The CNBC Daily Open brings investors all the information they need to know, wherever they are. Like it? Subscribe. here.
What you need to know today
Sharp decline
Wall Street fell Federal Reserve Chairman Jerome Powell speaks in Jackson Hole, Wyoming. S&P 500 After approaching an all-time high, it fell 0.89%. Dow Jones Industrial Average It fell 0.43% Nasdaq Composite Index The 10-year Treasury yield fell 1.67%. All three indexes were up during the session. Ministry of Finance Climbed It rose almost 9 basis points to 3.862%. US Oil Prices Increased by 1.42% It will wipe out most of the 2024 profits..
September rate cut
Philadelphia Federal Reserve Bank President Patrick Harker Approved interest rate cut in September Harker spoke to CNBC at the Fed’s Jackson Hole retreat. His comments came after minutes from the central bank’s last meeting showed growing confidence in inflation trends and concern over weakness in the labor market. “I think this means we need to start the process of lowering interest rates in September of this year,” Harker said, adding that the Fed should “signal deliberately and well in advance.” Harker is undecided about whether to cut by 25 basis points or 50 basis points. CNBC’s Jeff Cox has more on the matter. What to expect from Powell’s speech.
Peloton surges
Peloton Sales increased for the first time in nine quartersCost-cutting measures and a focus on profitability helped Peloton’s fourth-quarter sales rise 0.2% to $643.6 million. The embattled connected-fitness company also narrowed its losses to $30.5 million from $241.8 million a year ago. Peloton has struggled since the pandemic and is now run by a two-person board of directors, following the departure of former CEO Barry McCarthy. He resigned earlier this yearThe company’s shares soared 40% after the earnings announcement.
Coronavirus vaccine approved
The Food and Drug Administration Approved Latest Covid Vaccine Pfizer and Moderna The vaccine targets the KP.2 strain, a descendant of the Omicron variant JN.1, which was dominant in May amid a summer surge in virus infections and now accounts for about 3% of cases, but the drugmakers say the KP.2 vaccine may have a stronger response against other variants such as KP.3 and LB.1.
Self-driving cars
General MotorsCruise Uber To Bringing driverless driving to Uber users The move comes as Cruise tries to revive its robot taxi business. A serious incident last year and the ensuing investigation led to the resignation of the company’s CEO and co-founder. Uber abandoned its own self-driving project after a fatal crash in 2018 and is now working with other developers. GoogleWaymo.
[PRO] Bullish signal
With the S&P 500 within reach of its July record high, Ed Clissold, chief U.S. strategist at Ned Davis Research, suggests stocks could be headed higher. Two signals flashed in favor of the stock market this week.
Conclusion
Whether traders are working from home or in the office, everything will come to a halt at 10 a.m. ET as Federal Reserve Chairman Jerome Powell delivers one of the most anticipated economic speeches of the year.
“Majority“The number of Fed members advocating for a September rate cut has the market expecting a 100 basis point cut in 2024. With only three rate setting meetings remaining this year, we can expect at least one 50 basis point cut.”
George Brown, senior US economist at Schroders, said Powell Highlight the risks of aggressive rate cuts.
“I don’t think he’s going to commit up front to any particular path of monetary easing,” Brown told CNBC. “Instead, I think he’s going to signal that monetary policy will be data-driven and that decisions will be made according to the data.”
“Much of his speech will be focused on the risks of cutting rates too aggressively and too slowly. And I think his remarks will be focused on trying to find a middle ground that helps maintain or protect the economic expansion while keeping inflation in check.”
Henry Allen, macro strategist at Deutsche Bank, Market expectations for rate cuts next year are overly dovish Given the current economic situation, the market is “pricing in 200 basis points of rate cuts next year alone, a pace typically seen only in recessions, not non-recessions.”
Nevertheless, the Fed has faced criticism for keeping interest rates too high for too long. High reliance on data This could have a negative impact on the economy and stock prices.
“A soft landing is becoming more likely, which is why this rate-cutting cycle should be gentle and market-friendly. But I think it’s important for the Fed to move away from being so data-dependent, because that’s what caused them to miss the inflation turnaround,” Tom Lee, head of research at Fundstrat, said in an interview with CNBC.Squack Box“”in Interview Thursday.
— CNBC’s Jeff Cox, Fred Imbert, Gabriel Fonrouge, Laura Kolodny, Pia Singh, Alex Harring and Spencer Kimball contributed to this report.
