🚨 83% probability of another 25 bps rate cut at the October FOMC meeting in 41 days https://t.co/hCnqVtOMke ...

Core Viewpoint - The Federal Reserve has lowered the benchmark interest rate by 25 basis points to a range of 4% to 4.25%, with expectations for two more cuts by the end of 2025, which has positively impacted small-cap stocks like the Russell 2000 [1][4]. Group 1: Market Performance - The Russell 2000 index, which tracks 2,000 smaller companies, has seen a significant increase of 10% since the end of July, outperforming the S&P 500 during the same period [4]. - Following the Fed's rate cut announcement, the Russell 2000 rose over 2% and approached its all-time closing high of 2,442.74, indicating a potential recovery for small-cap stocks [4]. - Analysts predict that the Russell 2000 could rise as much as 20% in the next 12 months, compared to an 11% increase expected for the S&P 500 [7]. Group 2: Economic Factors - The reduction in interest rates is particularly beneficial for small-cap companies, many of which are highly leveraged and rely on variable financing, thus reducing their interest expenses [5][7]. - Despite the positive outlook, small-cap firms face risks such as lower margins, higher debt loads, and sensitivity to tariffs, which could impact their performance [5]. Group 3: Market Sentiment - Major financial institutions like Bank of America and UBS foresee a rebound in the Russell 2000, while Goldman Sachs warns of limited potential for small-caps to consistently outperform [5]. - The S&P 500 has been performing well, setting five records in a month, with some analysts predicting it could reach 7,000 by year-end, highlighting a broader market optimism [3].

Core Viewpoint - Hong Kong's three note-issuing banks, HSBC, Standard Chartered, and Bank of China (Hong Kong), are reducing their prime lending rates for the first time since December, which will lower funding costs and provide relief to businesses and mortgage borrowers in the city [1][2]. Group 1: Rate Adjustments - HSBC and Bank of China (Hong Kong) will lower their prime lending rates by 12.5 basis points to 5.125% effective Friday and Monday respectively, while Standard Chartered will cut its rate to 5.375% from Monday [2]. - All three banks will also reduce their savings rates by the same margin to 0.125% [2]. Group 2: Monetary Policy Context - The banks' rate cuts follow the Hong Kong Monetary Authority's (HKMA) decision to reduce its base rate by a quarter point, aligning with the US Federal Reserve's overnight cut [4]. - The HKMA's actions are part of a peg-linked system, but Hong Kong's commercial lenders independently determine their prime lending and deposit rates [4]. Group 3: Impact on Borrowers - HSBC's Hong Kong CEO stated that the adjustments are appropriate given the US rates decision and local market conditions, noting that HSBC has lowered its Hong Kong dollar best lending rate by 75 basis points since September 2024 [5]. - For a HK$5 million, 30-year loan priced at prime minus 1.75%, the 12.5-basis-point cut reduces the effective mortgage rate to 3.375%, lowering the monthly payment by HK$347 to HK$22,105 [5]. - As of the end of July, Hong Kong homebuyers had HK$1.887 trillion in outstanding mortgage loans, with an average mortgage size of HK$4.51 million [6].

Economic Performance - New Zealand's economy contracted by 0.9% in Q2, worse than the expected 0.3% decline, marking a contraction in three of the last five quarters [1][2] - Annual GDP decreased by 0.6%, contrary to market expectations of no change [2] Market Reactions - Following the GDP data, two-year swap rates fell by 10 basis points to 2.7290%, the lowest since early 2022, and the kiwi dollar dropped by 0.5% to $0.5932 [2] - The market is now anticipating a total of 58 basis points in cuts to the official cash rate (OCR), up from 48 basis points prior to the GDP release [3] Central Bank Outlook - The Reserve Bank of New Zealand (RBNZ) is expected to cut the OCR by 50 basis points in October and an additional 25 basis points in November, as indicated by Westpac [4] - The RBNZ has noted that household and business spending is constrained by uncertainty, falling employment, and rising prices for essentials [3][4] Sector Performance - The construction sector continues to decline, manufacturing is affected by slowing goods exports, and the service sector remains weak due to stagnant tourism [4] - The economy has also been impacted by U.S. import tariffs set at 15% on various products, including those from New Zealand [5] Future Expectations - There are signs of improvement in the third quarter, with slight increases in manufacturing and services indexes, as well as monthly employment and card spending data [6] - ANZ Senior Economist suggests that growth has returned in a muted manner, indicating the country may avoid another technical recession [7]

Stock markets spiked and then immediately reversed course after the Federal Reserve lowered the federal funds rate by a quarter percentage point to 4% from 4.25% on Wednesday in a move that had been telegraphed for weeks leading up to the meeting. Newly sworn in Federal Reserve Governor Stephen I. Miran voted against the action, in favor of a steeper cut of half a percentage point, the Fed disclosed in its monetary policy update. Miran was the only member to dissent. Stock markets, which have been at all- ...

Core Insights - Opendoor Technologies' shares are experiencing a significant increase, rising by 6.5% despite a decline in major indices like the S&P 500 and Nasdaq Composite [1] - The company's recent SEC filing indicates plans for nationwide expansion of its services, which has generated positive investor sentiment [2] - Federal Reserve's confirmation of a 0.25% rate cut is expected to positively impact Opendoor's margins, as lower interest rates generally benefit real estate companies [4] - Despite the potential for innovation in the digital real estate market, Opendoor's business model remains unproven, with the company currently operating at a loss and heavily reliant on debt [5]

分组1 - The Federal Reserve's recent decision to cut rates was influenced by risk management considerations, particularly regarding the labor market [2][8] - There were differing opinions within the Fed, with some members advocating for no cuts while others supported more aggressive cuts, indicating a division between hawks and doves [5][6] - The Fed appears confident that inflation will not experience second-round effects despite a softer labor market, which contributed to the decision for a rate cut [8] 分组2 - The market is interested in hearing the Fed chair's views on the independence of the Fed, the balance sheet, and risks to the labor market and inflation in upcoming meetings [10][11] - There is skepticism among some Fed officials regarding further rate cuts, suggesting a cautious approach moving forward [5][6]

If you look at uh the CME Fed watch, 96% chance, a 25 basis point cut. It seems to be the consensus we're going to get something. Is 50 basis points possible.I don't think so. I think you get 25 basis points. And I think the the more uh interesting dynamic surrounding this afternoon's Fed meeting is how many descents do we get.We potentially could get three descents. That's the first time since 1988. the dissents will be regarding what you're speaking toward, which is we should get a 50 basis point cut.So, ...

A rate cut will partly satisfy dovish capital markets, however, which have priced in a cut as a near certainty, with some even anticipating a 50bp move. A cut might also partially appease political pressure from a US administration pushing for significant easing. But by front loading rate easing, the Fed runs the risk of loosening before the inflation genie has been put firmly back in the bottle. This raises the danger of repeating its mis-steps last September, when the Fed trimmed rates by 50bps under ma ...

Morning Brief: Market Sunrise anchor Ramzan Karmali breaks down the latest international market news for September 17, 2025. Investors are expecting a 25 basis point rate cut at today's Fed meeting. Ramzan weighs in on Wall Street will be watching for. President Trump is visiting the UK as the two countries agree on a "Tech Prosperity" deal with an estimated value of $42 billion. Among the major companies involved in this agreement are Microsoft, Nvidia, Alphabet, CoreWeave, and Salesforce. Ramzan breaks do ...