🇺🇸 FED'S DALY: Further policy adjustments likely will be needed to support labor marketMore rate cuts incoming 📉 ...

Uh let's turn to the broader market now with stocks trading right around record levels. Joining us here on set is Gabriella Santos, chief market strategist for the Americas at JP Morgan Asset Management. So you're looking at a lot of the cross asset moves and you say that the focus has now been more by monetary policy versus the the fiscal and trade uh and other immigration policies coming out of Washington.uh how do you expect stocks and bonds to perform with monetary policy at front and center right now. ...

Market Overview - Major U.S. index futures indicate a modestly higher open, with stocks expected to rebound after previous session pressure [1] - Continued optimism in the artificial intelligence sector is driving stocks to record highs [1] Company-Specific Developments - Nvidia (NVDA) shares rebounded by 0.4% in pre-market trading after a 2.8% decline on Tuesday, generating early buying interest [2] - Alibaba (BABA) shares surged by 8.8% in pre-market trading following CEO Eddie Wu's announcement of increased spending on AI models and infrastructure [2][3] - Micron (MU) reported better-than-expected fiscal fourth-quarter earnings and forecasted first-quarter revenue above market estimates, yet experienced modest pre-market weakness [3] Trading Activity - On Tuesday, major averages declined, with the Nasdaq dropping 215.50 points (1.0%) to 22,573.47, the S&P 500 falling 36.83 points (0.6%) to 6,656.92, and the Dow dipping 88.76 points (0.2%) to 46,292.78 [4] - Retail stocks and software stocks showed significant weakness, with the Dow Jones U.S. Retail Index and Dow Jones U.S. Software Index both down by 1.2% [7] Economic Indicators - Federal Reserve Chair Jerome Powell expressed concerns about overvalued equity prices, indicating a challenging situation for monetary policy [5][6] - Upcoming consumer price inflation data is anticipated to influence trading activity [3] Commodity and Currency Markets - Crude oil futures increased by $0.93 to $64.34 per barrel, while gold prices decreased by $16.50 to $3,799.20 per ounce [10] - The U.S. dollar strengthened against the yen and euro, trading at 148.55 yen and $1.1745 against the euro [11] Asian Market Performance - Asian stocks ended mixed, with China's Shanghai Composite Index rising by 0.8% and Hong Kong's Hang Seng Index up by 1.4% due to tech stock gains [12] - Japanese markets saw the Nikkei 225 Index rise by 0.3% to a record high, despite data showing manufacturing activity shrank [13][14] European Market Performance - European stocks showed mixed results, with the German DAX Index up by 0.1% while the U.K.'s FTSE 100 Index and French CAC 40 Index declined [17] - Notable movements included German wind turbine maker Nordex securing a 50MW order and Atos jumping after winning a major cybersecurity contract [18]

Group 1 - Traders are reducing expectations for Federal Reserve interest rate cuts, reflecting mixed messaging from central bank officials [1][3] - Market participants are now betting on only one more 25 basis point rate cut in 2025, contrasting with previous expectations for a 50 basis point cut by year-end [2][6] - A wider range of monetary policy views from Fed officials has contributed to this shift, with some advocating for significant cuts while others caution against inflation [3][4] Group 2 - Fed Chairman Jerome Powell highlighted risks in the labor market and inflation without indicating support for a rate cut in the upcoming October meeting [5] - The FOMC recently reduced the policy rate to a range of 4% to 4.25%, marking the first cut of the year [6] - Current pricing in interest-rate swaps suggests a neutral rate around 2.95% and approximately 40 basis points of rate cuts over the remaining two meetings this year [7]

South Korea should maintain its accommodative fiscal and monetary policy settings to support the economic recovery, the IMF says https://t.co/B7tOgFOBJh ...

Market Performance Recap - Major U.S. market indexes closed lower on September 23, 2025, with the Dow Jones Industrial Average (DJIA) down 0.2% to 46,292.78, the S&P 500 (SPX) down 0.6% to 6,656.92, and the Nasdaq Composite (IXIC) down 0.9% to 22,573.47 [2][3] - The trading volume was 18.65 billion shares, higher than the last 20-session average, indicating increased market activity despite the pullback [3] Federal Reserve Influence - Federal Reserve Chair Jerome Powell's comments on stock valuations being "fairly highly valued" contributed to the market's cautious sentiment, leading to profit-taking, especially in the technology sector [3] - Powell's remarks came shortly after the central bank's latest interest rate cut, raising questions about the sustainability of the recent market surge [3] Individual Stock Highlights - Nvidia (NVDA) shares fell nearly 3% to 3.2% after a significant gain, influenced by a strategic partnership with OpenAI involving a $100 billion investment for data center buildout [7] - Boeing (BA) shares rose between 1.7% and 2.2% following a deal with Uzbekistan Airways for 14 787 Dreamliner jets, valued at over $8 billion [7] - AutoZone (AZO) experienced a decline of 0.7% to 2.9% due to weaker-than-expected fourth-quarter fiscal 2025 profit, attributed to increased spending [7] - Kenvue (KVUE) shares climbed 2.2% to 3.3%, recovering losses from the previous day, despite concerns related to Tylenol [7][8] - General Motors (GM) shares were up 0.3% after Mizuho raised its price target, noting minimal impact from tariffs and a potential 17% surge in EV sales [12] - Apple (AAPL) approached all-time peaks with a 4.3% rise after a price target increase, although durability concerns regarding iPhone 17 models emerged [12] - Oracle (ORCL) saw a significant jump of over 6% after announcing new co-CEOs [12] Upcoming Economic Indicators - Key economic data releases are anticipated, including the August Personal Consumption Expenditures (PCE) reading, which is crucial for gauging inflation and influencing Federal Reserve policy [5] - Updates on August's U.S. Durable Goods Orders, Q2 GDP Growth Rate (Final), and Existing Home Sales are also expected, providing insights into the U.S. economy's health [6]

Inflation & Employment Risks - Near-term inflation risks are skewed to the upside, while employment risks lean towards the downside, creating a complex situation with no risk-free solutions [1] - Overly aggressive easing could leave inflation unresolved, potentially requiring corrective measures to achieve the 2% target [2] - Maintaining a restrictive policy for too long could unnecessarily weaken the labor market [2] Monetary Policy Stance - Increased downside risks to employment have altered the balance of risks in achieving the dual mandate [3] - The Federal Reserve lowered the target range for the federal funds rate by 25 basis points to 4% - 425% [3] - The current policy stance is considered modestly restrictive, allowing flexibility to respond to economic developments [3]

I just have to say this. Whenever we make decisions, we're never, ever thinking about political things. And so we you know, we're based in Washington, D.C. , and many, many people, you know, in Congress. And, you know, there are often things that are seen through a through a lens of, is it good for this party or bad or bad for this party or this politician.We're just not looking at things that way. We're looking at what's the best thing for the people that we serve in the medium term. What's the best policy ...

Market Performance - Major stock indices, including the Dow, Nasdaq, and S&P 500, have shown a notable decline, with the Nasdaq down 197.61 points (0.9%), S&P 500 down 35.53 points (0.5%), and Dow down 96.69 points (0.2%) [2] - The decline in stock prices may be attributed to concerns over overvaluation following comments from Federal Reserve Chair Jerome Powell [2][3] Federal Reserve Insights - Jerome Powell described equity prices as "fairly highly valued" and highlighted the Fed's challenging situation regarding inflation and employment risks [3] - Powell emphasized the need to balance the dual mandate of inflation control and employment stability, indicating that aggressive easing could leave inflation unaddressed, while prolonged restrictive policies could harm the labor market [4] Sector Performance - Software stocks faced significant selling pressure, leading to a 1.4% decline in the Dow Jones U.S. Software Index, which had previously reached a record high [6] - Retail stocks also showed weakness, with the Dow Jones U.S. Retail Index down by 1.1% [6] - In contrast, energy stocks performed strongly, with the Philadelphia Oil Service Index surging by 4.0% and the NYSE Arca Oil Index increasing by 2.0% due to rising crude oil prices [7] Company-Specific News - Nvidia's shares fell by 3% after a previous surge of nearly 4% to a record high, influenced by its strategic partnership with OpenAI to deploy Nvidia systems for AI infrastructure [4][5]

Near-term risks to inflation are tilted to the upside and risks to employment are tilted to the downside. A challenging situation. Two sided risks mean that there is no risk free pass.If we ease too aggressively, we could leave the inflation job unfinished and need to reverse course later to fully restore 2% inflation. If we maintain restrictive policy too long. The labour market could soften unnecessarily when our goals or intention like this are.Framework has long called for us to balance both sides of ou ...