Household net worth climbed by more than $7tn in the April-to-June period thanks mostly to a $5.5tn increase in the value of stock market holdings, the Fed said.US household wealth rose to a record $176.3tn (£129.9tn) in the second quarter on the back of a resurgent stock market and climbing property prices, data from the Federal Reserve showed on Thursday.James Knightley, at ING, said: “Inflation was a touch higher than expected and tariffs are likely to keep it elevated over coming months, but the weakeni ...

Group 1 - Deutsche Bank raised its year-end target for the S&P 500 to 7,000 from 6,550, reflecting an optimistic outlook on earnings growth and interest rate cuts [2][6] - Barclays also increased its year-end target for the S&P 500 to 6,450 from 6,050 and raised its 2026 target to 7,000 from 6,700 [6][7] - Analysts project earnings growth of more than 9.5% this year and almost 14% next year, indicating strong corporate performance [4] Group 2 - The S&P 500 index reached a record high, driven by enthusiasm around AI and expectations of interest rate cuts by the Federal Reserve [3][6] - Companies are managing the impact of tariffs better than anticipated, with Deutsche Bank noting that the effects are seen as modest and manageable [3][4] - Analysts favor large growth stocks, tech shares, and financial shares while remaining underweight in defensive sectors like consumer staples and utilities [5]

Core Viewpoint - PepsiCo Inc. has faced significant stock pressure, with a decline of 5.89% in 2025 and 19.5% over the last 12 months, reflecting broader challenges in the consumer staples sector [1][2] Group 1: Stock Performance and Market Context - The total return for PepsiCo stock over the last three years is negative 9.1%, indicating a decline in overall stock value despite a growing dividend yield of 4.02% [4] - Rising inflation and interest rates have pressured the core consumer, contributing to the stock's weak performance [5] - The consumer staples sector, including PepsiCo, has been under pressure for several years, complicating the narrative around interest rate cuts potentially benefiting the stock [2][9] Group 2: Demand Challenges and Competitive Landscape - The adoption of GLP-1 drugs is impacting consumer demand for soft drinks and salty snacks, posing a challenge to PepsiCo's traditional strengths [3] - Consumers are increasingly opting for store brands due to lower prices, which further pressures PepsiCo's market position [6] Group 3: Earnings and Strategic Pressure - PepsiCo's earnings per share (EPS) for the first two quarters were $3.6, down 7% year over year, raising concerns among investors [7] - Elliott Investment Management has taken a $4 billion stake in PepsiCo, urging the company to improve margins and consider divesting low-margin brands [7][8] Group 4: Dividend and Valuation Insights - PepsiCo's dividend yield is currently at 3.99%, with an annual dividend of $5.69 and a payout ratio of 103.64% [9] - The stock appears reasonably valued at around 17.2x forward earnings, trading at a discount to its historical average and the consumer staples sector average [11]

US stocks rose on Thursday as the latest reading on inflation showed consumer prices ticked up in August, helping set expectations for the pace of interest rate cuts this year. Meanwhile, more data showed fresh signs of weakness in the labor market. The Dow Jones Industrial Average (^DJI) and the S&P 500 (^GSPC) rose over 0.3%, while the tech-heavy Nasdaq Composite (^IXIC) all gained around 0.4%, on the heels of a muted but record-setting session on Wednesday. Thursday's Consumer Price Index (CPI) repor ...

Group 1 - The European Central Bank (ECB) has kept interest rates unchanged at 2% and has not provided guidance on future rate changes, despite expectations for additional support as inflation is projected to dip below the target next year [1][2] - Recent data supports the ECB's positive outlook, allowing policymakers to assess the impact of external factors such as U.S. tariffs and political issues in France on growth and inflation [2][4] - Inflation is projected to temporarily fall to 1.9% in 2027, below the 2% target, with core inflation also expected to be below the target at 1.8% [3] Group 2 - The ECB is likely to maintain current interest rates for an extended period, with market expectations indicating a 50-60% chance of one last rate cut by spring [4] - The debate among policymakers is centered around the resilience of the euro zone economy, with some members arguing against further easing due to strong private consumption and industrial production [5] - Adaptability of firms in response to U.S. tariffs is noted, with the certainty of an agreed deal mitigating some negative impacts [6]

Cryptocurrencies are being boosted by hopes of multiple cuts this year and by hype around IPOs and crypto treasury companies. ...

Market Overview - U.S. stock futures rose on Thursday following a mixed close on Wednesday, with major benchmark indices showing positive movement [1] - The Producer Price Index (PPI) decreased by 0.1% in August, contrary to expectations of a 0.3% increase, indicating a slowdown in wholesale inflation from 3.3% to 2.6% year-over-year [2][5] - The 10-year Treasury bond yielded 4.05%, while the two-year bond was at 3.55%, with markets pricing a 100% likelihood of the Federal Reserve cutting interest rates in the upcoming decision [2] Sector Performance - On Wednesday, energy and information technology stocks gained, while most other sectors in the S&P 500 finished lower, particularly consumer discretionary, health care, and consumer staples [4] - The Dow Jones index fell by 220 points (0.48%) to 45,490.92, while the S&P 500 rose by 0.30% to 6,532.04 [7][8] Company Insights - AI-linked stocks saw a rally due to optimism surrounding earnings growth from artificial intelligence, particularly after Oracle Corp. reported a significant backlog of AI-related orders [6] - Chewy, Inc. shares dropped approximately 17% following the release of its second-quarter results [6] - Oracle Corp. experienced a 1.61% increase in stock price, continuing its rally after reporting a record Remaining Performance Obligations (RPO) of $455 billion, a 359% increase year-over-year [19] Economic Indicators - Goldman Sachs projects a 0.37% month-over-month increase in the Consumer Price Index (CPI) for August, leading to a year-over-year inflation rate of 2.9%, slightly above the Wall Street consensus [10][11] - The core CPI, excluding food and energy, is expected to rise by 0.36% month-over-month, bringing the annual rate to 3.13% [11] Future Projections - Analysts suggest that the anticipated easing cycle by the Federal Reserve could lead to a significant reallocation of the $7.4 trillion in money market funds back into equities, potentially fueling the next wave of stock market gains [12][13] - LPL Research indicates that the resumption of monetary policy easing could provide additional support for equity markets, with expectations of continued strong performance driven by AI investments and steady economic growth [14]

Key Points Investors are feeling increasingly pessimistic about the stock market. If a recession is looming, history has good news for investors. The right strategy can help protect your portfolio no matter what happens. 10 stocks we like better than S&P 500 Index › While we're not in a recession yet, some investors are beginning to worry that it's coming. Around 43% of investors feel "bearish" about the next six months, according to the most recent weekly survey from the American Association of ...

Economic Outlook - The European Central Bank is expected to maintain steady interest rates but may signal the possibility of further easing due to a challenging trade and political environment [1] - The U.S. Federal Reserve is anticipated to implement three interest rate cuts this year, with a quarter-point move fully priced in for the upcoming meeting and an 8% chance of a 50 basis-point cut [5][10] Market Performance - Japan's Nikkei index rose 0.8% to reach a record high, driven by gains in technology, energy, and utility sectors [2] - Taiwanese shares increased by 1%, also setting a record, with leading chipmaker TSMC rising 2.5% and SoftBank surging nearly 9% following Oracle's significant 36% gain on Wall Street [2][9] - Nasdaq futures rose 0.2% and S&P 500 futures inched up 0.1% [4] Inflation and Consumer Prices - The U.S. Producer Price Index (PPI) reading has led to a more dovish outlook among investors, with a focus now shifting to the Consumer Price Index (CPI) for August, which is expected to show a 2.9% year-over-year increase, the largest since January [6][10] - The core CPI is anticipated to remain at 3.1%, and unless there is a significant upside surprise, the dovish sentiment is likely to persist [6][10] Bond and Currency Markets - The 10-year Treasury yield increased by 2 basis points to 4.0531%, while the 30-year yield rose to 4.7028%, having decreased over 30 basis points from a peak of 5% [8][9][10] - The U.S. dollar index remained flat at 97.81, slightly above a seven-week low, while the Australian dollar reached a 10-month high of $0.6636 before stabilizing at $0.6616 [7][8][10] Commodity Markets - Oil prices maintained gains, with U.S. crude steady at $63.65 per barrel and Brent at $67.49, following geopolitical tensions involving Poland and Russian drones [9][10] - Gold prices increased by 0.1% to $3,644 per ounce, nearing all-time highs [9][10]

By Sinéad Carew and Marc Jones NEW YORK/LONDON (Reuters) - MSCI's global equities gauge hit a record high on Thursday while U.S. Treasury yields fell along with the dollar due to growing expectations for interest rate cuts, as softer labor market data overshadowed a higher-than-expected U.S. inflation reading. The Consumer Price Index increased by 0.4% in August, the most in seven months and following a 0.2% rise in July, driven by a 0.4% jump in housing costs and a 0.5% increase in food prices. The cost ...