Unlock the Editor’s Digest for free Roula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter. Sweden’s central bank cut interest rates for the first time in eight years as European monetary policymakers diverge from the US to support their economies even if it comes at the expense of their currencies….
Daniel Grizelj/DigitalVision via Getty Images The Federal Reserve has as one of its main tools to manage the rate of inflation the Federal Funds Rate. The purpose of this tool is to either entice borrowers to borrow if they make the interest rate low, or to reduce demand for borrowers if they make the cost…
gerenme People see and hear what they want. While Powell spoke softly at Wednesday’s press conference, the message was that rate cuts will take longer to come by in 2024, and longer will mean fewer rate cuts. Powell has never been one to speak with harsh words. On top of that, market mechanics give this…
richcano Love the Fed? That may be too strong a sentiment. But at the very least, the bond market is channeling its inner Dude (as in “The Big Lebowski”) and abiding the Fed. The market had already priced itself out of the multiple rate cut fantasy with which it started the year when the FOMC…
LD By Stephen H. Dover, CFA, Chief Market Strategist, Head of Franklin Templeton Institute | Rick Polsinello, CIMA, Senior Market Strategist, Franklin Templeton Institute Originally published in Stephen Dover’s LinkedIn Newsletter, Global Market Perspectives. As was widely expected, the Federal Reserve (Fed) decided to again leave the Fed funds rate unchanged at the Federal Open…
LD By Kevin Flanagan Once again, the Fed kept rates unchanged at the May FOMC meeting. As a result, the Fed Funds trading range remains in the 5.25-5.50% band introduced in July 2023 and still resides at a more than 20-year high-water mark. For those keeping track, this represents the sixth consecutive FOMC meeting in…
yalcinsonat1 By James Knightley | Padhraic Garvey, CFA | Chris Turner Fed keeps rates at 5.25-5.50% As universally expected, the Federal Reserve has left the Fed funds target rate range at 5.25-5.50%. The decision was unanimous and was made pretty easy, given inflation continues to run too hot for comfort, consumers are still spending strongly,…
Samuel Corum The FOMC meeting in May may prove to be a pivot point yet again for a Fed that has struggled to find its way over the last few months and, for a time, appeared to lose control of the market and its battle against inflation. However, with three hot CPI prints in a…
Justin Sullivan They say in thirty years, a burger and fries could cost $16, a vacation $12,400, and a basic car $65,000… No problem. You’ll eat in. You won’t drive. And you won’t go anywhere. TIAA-CREF advertisement (placed in The New Yorker in 1994). Since the Fed began raising interest rates in 2022, traders have…
RiverNorthPhotography Listen below or on the go on Apple Podcasts and Spotify Traders will be looking for any hints to the timing of rate cuts. (0:17) Apple and Amazon lead the earnings parade. (2:06) Elon Musk makes surprise visit to China. (4:12) The following is an abridge transcript: It’s a big week on the economic…
Editor’s note: Seeking Alpha is proud to welcome Tomas Cverna as a new contributing analyst. You can become one too! Share your best investment idea by submitting your article for review to our editors. Get published, earn money, and unlock exclusive SA Premium access. Click here to find out more » Richard Drury/DigitalVision via Getty…
Dan Totilca Just getting around to finishing the review of the financial sector names that are followed, going through Goldman Sachs (NYSE:GS) numbers today finds the stock reasonably valued as it’s preparing to trade above its August ’21 all-time-high of $420. Goldman is not the same Goldman that investors knew in the late 1990s (GS…
Douglas Rissing Let’s build the story of the monetary tightening by the Federal Reserve in this way. Since March 16, 2022, the Federal Reserve has overseen a reduction in its securities’ portfolio of $1,561 billion. Since March 16, 2022, the Federal Reserve has overseen a reduction in the use of reverse repurchase agreements of $1,069…
Eoneren By James Knightley, Chief International Economist US inflation remains too hot for comfort US core consumer price inflation came in at 0.4% month-on-month, above the 0.3% consensus – only one forecaster predicted such an outcome, so just like last Friday’s jobs report, this is another significant upside surprise that should quash expectations of a…
Klaus Vedfelt And wages rose at a good clip too. It was the kind of jobs report we’d expect from an economy that is plugging along just fine, at growth rates that are above the long-run average, powered by consumers outspending inflation with gusto, especially on services, the government spending trillions it borrows hand-over-fist, and…
Win McNamee It seems pretty clear that Jay Powell is not rushing to cut rates. He has spoken twice since the February PCE report, and both times, he has emphasized patience regarding the Fed’s next steps. He has also, to some degree, played down the elevated January and February inflation reports. While the Fed is…
DariaRen iShares 20+ Year Treasury Bond ETF (NASDAQ:TLT) is a popular and highly liquid ETF that invests primarily in U.S. Treasury Bonds. In early 2020, this ETF hit highs of about $180 per share. It now trades for about half that level, at just around $92 per share. Since the portfolio holdings for this ETF…
pcess609/iStock via Getty Images The Bureau of Economic Analysis (BEA), has just released its estimate for February 2024 US Personal Consumption Expenditures (PCE). Also known as “Personal Spending,” PCE directly accounts for over 60% of total US Gross Domestic Product (GDP), marking it a crucial indicator for assessing changing rates of expansion, contraction, and momentum…
MCCAIG The current investor fixation on when the Federal Reserve will drop interest rates and by how much overlooks an important fact – almost everyone is already bullish. So, even if they do drop rates who’s left to buy to drive prices higher? I believe it was Nathan Rothschild who pointed out this contradiction about…
Justin Sullivan Verizon Communications (NYSE:VZ) is a U.S. based communications company and a giant in the industry. A few months ago, this stock was making 52-week lows and trading at what seemed to be highly irrational levels. The selling pressure seemed to be a culmination of events that took place late last year, which included…
wildpixel/iStock via Getty Images We witnessed another momentous week as the Federal Reserve’s tone on markets was more dovish than anticipated. Jay Powell said that the Fed still expects three rate cuts this year, which helps enable a highly constructive backdrop for stocks and other risk assets. Moreover, with the Fed in QT wind-down mode,…
AdamParent Listen below or on the go on Apple Podcasts and Spotify FOMC members may look to temper market enthusiasm. (0:20) GameStop, Walgreens set to report earnings. (2:26) Goldman sees path to S&P 6,000. (4:38) The following is an abridged transcript: The top stories to look out for The Fed took the headlines this past…
Anna Moneymaker/Getty Images News The FOMC meeting this week surprised many when it was revealed that the Fed still intended to cut rates three times in 2024. It seemed that given the back-to-back, hotter CPI inflation report to start the year and rising inflation expectations, the Fed would begin to push back against the easing…
Kevin Dietsch The Fed concluded their second FOMC meeting of the year on March 19th. The official Policy Statement contained two Policy Decisions: The Fed will maintain the Fed Funds Rate at the target range of 5.25% to 5.50% The Fed will continue reducing holdings of its Treasury securities and MBS as previously announced. The…
yalcinsonat1 No, Jay Powell did not do a happy dance at the post-FOMC press conference, but the Fed chair was feeling good on Wednesday and it showed. And why not? The big takeaway from the much-anticipated “dot plot” – the Summary Economic Projections representing Committee members’ best guesses about the economy and interest rates –…
yalcinsonat1 By Stephen H. Dover, CFA, Chief Market Strategist, Head of Franklin Templeton Institute | Rick Polsinello, CIMA, Senior Market Strategist, Franklin Templeton Institute Originally published in Stephen Dover’s LinkedIn Newsletter Global Market Perspectives. As was widely expected, the Federal Reserve (Fed) decided to leave the Fed funds rate unchanged at its March 20 Federal…
Dilok Klaisataporn There are a lot of questions about Fed policy these days and where things might be headed. Here are some commonly asked questions I’ve been getting lately: 1) Why is the Fed considering a rate cut? At Wednesday’s FOMC meeting the Fed stood by their estimate of 3 rate cuts in 2024. This…
niphon By Seema Shah, Chief Global Strategist To no-one’s surprise, the Federal Open Market Committee (FOMC) chose to keep the benchmark policy rate at 5.25%-5.50% on March 20th. More significantly, the latest dot plot revealed the committee continues to expect 75 basis points of cuts this year. That is despite recent upside inflation surprises as…
Chip Somodevilla/Getty Images News The benchmark index of Wall Street, the S&P 500 (SP500), surged by about 1% to a new all time high following fresh signals from the Federal Reserve and Chair Jay Powell about the rates path in 2024. While the updated FOMC projections highlight a slight shift in the rates dotplot at…
yalcinsonat1 Stocks closed higher ahead of the Fed’s meeting this week, as tech behemoths Apple and Google rebounded on news that the iPhone maker will build Google’s Gemini artificial intelligence engine into its phones. Still, nine of the eleven S&P 500 sectors finished modestly in the green, while small caps struggled, which is likely due…
ronniechua Despite increased volatility and rolling corrections, the S&P 500/SPX (SP500) continues trading near its ATH. The SPX recently nailed a top of around 5,200, which is impressive considering the upside of approximately 27% since the October 2023 correction bottom, which occurred only about four months ago. If we disregard the 2023 correction, the SPX…
Spencer Platt/Getty Images News Listen on the go! A daily podcast of Wall Street Breakfast will be available by 8:00 a.m. on Seeking Alpha, iTunes, Spotify. Nvidia’s GTC is now the AI Woodstock. (0:52) The Fed’s new dot-plot will be the big focus. (1:37) Reddit set to start trading. (2:24) The following is an abridged…
Kent Nishimura/Getty Images News The December SEP projections The FOMC is set to meet next week and will likely decide to leave the Federal Funds unchanged at the 5.25-5.50% range. However, the market is starting to price the Fed’s hawkish turn – or a signal from the Fed that it plans to cut interest rates…
Get ahead of the market by subscribing to Seeking Alpha’s Wall Street Week Ahead, a preview of key events scheduled for the coming week. The newsletter keeps you informed of the biggest stories set to make headlines, including upcoming IPOs, investor days, earnings reports and conference presentations. The Federal Reserve meeting will draw all the…
Natee127 Upstart Holdings, Inc. (NASDAQ:UPST) remains unloved and neglected, even though the fintech’s sales trends are looking much better compared to the beginning of 2023. The present year will be a transition year for Upstart Holdings, and the central bank’s rate timeline could be a catalyst for a re-rating to the upside in 2024. Upstart…
courtneyk Earlier today, the Bureau of Labor Statistics released the February nonfarm payroll report. The report showed that the economy generated 275,000 jobs in the month of February, which was stronger than expected, but the unemployment rate rose to 3.9%. Part of the offset in the strong jobs report was the downward revisions of the…
Chip Somodevilla On the first day of Powell’s testimony, not much happened, and he failed to take control. There was very little that was new. This comes despite continued signs of inflation reaccelerating and robust economic data. If the Fed is correct in its assessment that inflation will return to target, the unemployment rate will…
Sviatlana Zyhmantovich Affirm Holdings, Inc. (NASDAQ:AFRM) makes a solid value proposition for investors after the fintech’s stock price slid from $50 to $38 after the fintech’s earnings. Affirm Holdings is growing, seeing ongoing momentum with its Affirm Card and in 4Q-23 announced a partnership with Amazon which saw the fintech’s buy now pay later (BNPL)…
sasirin pamai By James Knightley Fed’s Powell inclined to cut rates this year, but needs the data to justify it There was nothing particularly surprising within Fed Chair Powell’s prepared monetary policy testimony to Congress – which is pretty short in fairness – or the Q&A session. The main comments are that “the risks to…
manassanant pamai By Ewa Manthey, Commodities Strategist Fed policy remains key for gold Federal Reserve policy will remain key for the outlook of gold prices in the months ahead. US dollar strength and central bank tightening weighed on the gold market for most of last year. Swaps markets suggest investors don’t see much chance of…
GOCMEN/iStock via Getty Images When it comes to deciding when to begin cutting key short-term interest rates, it seems to me that the Federal Reserve seems overly fixated on small monthly variations in various inflation indicators rather than paying attention to the dramatic slowdown in the U.S. economy. In my view, they should start cutting…
Rudy Sulgan/The Image Bank via Getty Images The underlying floor of our coming markets continues to be the Fed and when they might lower interest rates. They have extolled their Quantitative Tightening as a fight with Inflation. While I have no doubt about the truthfulness of this statement, the flip side of the coin has…
Torsten Asmus I’ve covered some of the more important trends impacting bonds and bond ETFs these past few years, as Federal Reserve hikes have led to wild swings in interest rates and broader bond market conditions. Last time I covered these issues for the Vanguard Total Bond Market Index Fund ETF (NASDAQ:BND), nominal rates were…
JamesBrey Thesis Summary The Federal Reserve left rates unchanged in the last FOMC meeting, and odds are we won’t get a rate cut in March either. The Federal Reserve is being weary of cutting too soon since the economy has remained very strong, and there is a fear inflation could return. But what if deflation…
Richard Drury Transcript Greg Bonnell: Following another red-hot US jobs report, Fed Chair Jerome Powell is once again saying he’s in no rush to cut interest rates. Joining us now to discuss, Chris Whelan, the Senior Canada Rate strategist and Head of Portfolio and ESG strategy at TD Securities. Chris, great to see you again….
In a recent statement, former President Donald Trump made it clear that, if elected for a second term, he would not reappoint Jerome Powell as the Federal Reserve Chair. Trump has expressed his dissatisfaction with the current Fed Chair’s performance, and suggests that Powell will rate cuts in attempt to give Democrats an advantage in the…
Nerthuz By James Knightley, Chief International Economist | Padhraic Garvey, CFA, Regional Head of Research, Americas | Chris Turner, Global Head of Markets and Regional Head of Research for UK & CEE Fed caution argues against a March rate cut No change from the Federal Reserve on interest rates (target range kept at 5.25-5.50%) and…
deepblue4you Thesis The Invesco Short Term Treasury ETF (NYSEARCA:TBLL) is a fixed income exchange traded fund. The vehicle is based on the ICE U.S. Treasury Short Bond Index and will invest at least 80% of its holdings in the index components. The fund is not a passive replication of said index but takes an active…
da-kuk @NeilKSethi over on X is a prolific contributor of economic and market data every day. The man truly works hard at his task. Neil posted the above graphic in the last few days. While I understand the sentiment, speaking with another advisor the other day, this individual noted that not one of his clients…
DaveAlan/iStock Unreleased via Getty Images Listen below or on the go on Apple Podcasts and Spotify Boeing’s earnings call and megacap results highlight earnings this week. (0:19) Bye-bye inverse Cramer ETF. (4:36) The Osborne Effect may be in play for Tesla. (5:14) The following is an abridged transcript: The top story to look out for…