Market Overview - Global financial markets are showing mixed performance due to monetary policy shifts, tech sector developments, and geopolitical changes [2] - Gold and Japanese equities are experiencing strong upward momentum, while US stock futures have declined [2] Gold Market - Gold has achieved its fifth consecutive weekly gain, trading near record highs, driven by the Federal Reserve's 25-basis-point rate cut and expectations of further easing [3] - The precious metal is benefiting from safe-haven demand as investors await US inflation data and Fed Chair Powell's economic outlook [3] Japanese Market - Japanese stocks are performing well, with the Nikkei Index rising 1% to 45,499.10 points, following the Bank of Japan's decision to gradually sell its ETF holdings [4] - This divestment is seen as a move towards normalizing the central bank's balance sheet, contributing to market confidence [4] Technology Sector - Samsung Electronics shares increased by 3% after passing NVIDIA's qualification test for its 12-layer HBM3E products, crucial for advanced computing systems [5] - This qualification positions Samsung as a key supplier in the competitive high-bandwidth memory market, particularly for AI and graphics processing [5] US Market Concerns - US stock futures have dipped, with S&P 500 futures down 0.11% and Nasdaq futures down 0.07%, influenced by concerns over a proposed $100,000 H-1B visa fee [6] - The new fee raises apprehensions in the US tech industry, which relies heavily on H-1B visa holders, potentially impacting tech hiring and the $280 billion IT sector in India [6] Regional Market Performance - Australia's S&P/ASX 200 Index rose 0.5% to 8,816.10, reflecting positive sentiment in the market [7] - The New Zealand Dollar fell to a two-week low of $0.5853, indicating currency weakness [8] Geopolitical Developments - Diplomatic meetings involving South Korea, the US, and Japan are scheduled to address regional and global issues during the U.N. General Assembly [8] - North Korea's Kim Jong Un reiterated the country's stance against denuclearization, emphasizing military strengthening [8]

Group 1 - The U.S. Federal Reserve has lowered its benchmark interest rate for the first time since December, indicating that more cuts may follow to support a struggling labor market [1][10] - The Fed's rate cut is expected to benefit interest-rate sensitive sectors, particularly small-cap stocks and consumer discretionary shares, with homebuilders being a notable beneficiary [2][10] - The S&P 500 reached record high levels, up over 13% year-to-date, following the Fed's decision to cut the benchmark rate by 0.25 percentage points to the 4-4.25% range [2][11] Group 2 - The PHLX Housing index has increased by 15% this quarter, outperforming the S&P 500's gain of over 7%, although it still lags behind on a year-to-date basis [5][11] - Major homebuilders such as DR Horton, KB Home, and Toll Brothers have seen significant gains, with DR Horton up over 30% and both KB Home and Toll Brothers up over 20% this quarter [5][11] - Home improvement retailers Lowe's and Home Depot have also performed well, with increases of approximately 20% and 13% respectively this quarter [5][11] Group 3 - The contract rate on a 30-year fixed-rate mortgage has fallen to 6.39%, the lowest since early October 2024, with projections suggesting it could approach 6% by year-end [6][11] - The housing market is currently facing challenges, with single-family homebuilding dropping to a near 2.5-year low in August, indicating weakness in the sector [11] - Investors are hopeful that lower mortgage rates could revitalize the housing market, with a target of bringing rates down to the 5% range being seen as crucial [7][11] Group 4 - The relationship between the Fed funds rate and mortgage rates is complex, as mortgage rates are more closely tied to the 10-year U.S. Treasury yield, which was around 4.13%, down from 4.6% in May [8][11] - Upcoming economic data, including existing and new home sales, will provide further insights into the housing market, with a good housing turnover being beneficial for overall economic activity [9][11] - The Fed's approach to rate reductions remains uncertain due to persistent inflation, which could lead to volatility in economic data related to the labor market and inflation [9][11]

By Lewis Krauskopf NEW YORK (Reuters) -As the U.S. Federal Reserve restarts interest rate cuts, housing shares are one of the areas of the stock market that may benefit, and they have perked up in recent weeks as markets priced in more monetary easing. On Wednesday, the U.S. central bank lowered its benchmark rate for the first time since December and indicated more cuts would follow as it tries to shore up a shaky labor market. The Fed's move stands to help interest-rate sensitive areas such as small-c ...

Monetary Policy and Economic Outlook - The U.S. Federal Reserve cut interest rates by 25 basis points for the first time this year, indicating a shift towards monetary easing and expecting two more cuts by year-end [1][9] - Despite inflation remaining above the 2% target, the increase in the unemployment rate has pressured policymakers to focus on supporting economic growth [2] - The Fed has raised its projections for economic growth this year, with expectations for higher growth next year [2] Investment Opportunities - Investors are encouraged to design their portfolios to capitalize on the improving economic scenario, with broker-adored stocks such as CVR Energy (CVI), Asbury Automotive Group (ABG), American Axle & Manufacturing Holdings (AXL), General Motors Company (GM), and Adient plc (ADNT) highlighted for potential returns [3][9] - A screening process has been developed to shortlist stocks based on improving analyst recommendations, upward estimate revisions, and low price/sales ratios [4][5] Stock Screening Criteria - The screening parameters include net upgrades in analyst ratings over the last four weeks, earnings estimate revisions, and a focus on companies with lower price/sales ratios [5][6] - Additional criteria include a current price greater than $5, an average daily volume exceeding 100,000 shares over the last 20 trading days, and a market value in the top 3000 stocks by market capitalization [6] Company Profiles - CVR Energy is involved in renewable energy and petroleum refining, committed to developing renewable biofuels [7] - Asbury Automotive Group has a diversified product mix and is leveraging its e-commerce platform, Clicklane, for growth [8][10] - American Axle is advancing in the electric drive space, enhancing its market position through collaborations [11][12] - General Motors remains the top-selling U.S. automaker, driven by strong demand for its vehicles and a robust electrification strategy [13][14] - Adient is a leading automotive seating supplier with a diverse customer base and strong market presence [14][15]

RT CoinDesk Indices (@CoinDeskMarkets)“Recent economic data suggests that risk assets are reaching new highs even in the absence of monetary easing, yet the real story isn’t cyclical, it’s structural,” says Adam Guren of Hunting Hill Global Capital.https://t.co/Z8qZGaa9me ...

Monetary Policy - Bank of Canada cut interest rates [1] - The cut is a response to economic and labor market damage from US tariffs [1] - The bank remained vague about future monetary easing plans [1]

Corporate Sector Focus - U.S. corporate sectors sensitive to interest rates are in focus as the Federal Reserve is poised to lower borrowing costs for the first time this year, following hints from Chair Jerome Powell [1][2] - Traders have priced in a 25 basis points rate cut and expect two more cuts by the end of 2025, contributing to record highs in U.S. stock markets, particularly in technology and bank stocks [2] Small Caps - Small-cap companies rely heavily on external borrowing, and lower borrowing costs will increase their available capital, allowing them to refinance existing debt more cheaply [3] - The Russell 2000 small cap index has rallied over 5% since Powell's comments on August 22, although it remains below its record high from November 2021 [4] Banks - The banking sector faces a complex situation; while lenders benefit from rising interest rates, increased competition for deposits may lead to higher funding costs, impacting profits [5] - The spread between two-year and 10-year Treasury notes reached its steepest since April but has reversed some gains recently due to soft labor market data [6] - The KBW regional banking index has gained about 1.4% since Powell's dovish comments, while the S&P 500 banks index has increased nearly 5% [6] Growth Stocks - Interest rate cuts are expected to boost growth and technology stocks, as lower rates enhance the present value of future earnings, benefiting companies anticipated to grow at an above-average rate [7]

Core Insights - The Federal Reserve is anticipated to announce its first interest rate cut of the year, with expectations of a 25 basis point reduction, bringing the policy rate to 4.00-4.25% [2][9] Economic Context - Recent data indicates a weakening U.S. economy, characterized by slower hiring and a rising unemployment rate, which suggests a softening labor market [6] - Inflation remains above the Federal Reserve's 2% target, but increasing unemployment pressures policymakers to shift focus towards supporting growth and financial stability [7] Impact on Banks - The expected rate cuts are likely to stabilize banks' funding costs and support net interest income (NII) expansion, a critical earnings driver for banks [8] - Lower benchmark rates may compress yields on loans and securities, but easing funding pressures can help preserve margins [8] - A rate cut is expected to make refinancing more affordable, reducing default risks and improving credit quality for banks [10] Bank-Specific Insights M&T Bank (MTB) - MTB's NII has a compounded annual growth rate (CAGR) of 15.4% over the past four years, with projections for NII to rise to $7.05-$7.15 billion in 2025 from $6.85 billion in 2024 [11][12] - The bank expects average loans and leases to be between $135 billion and $137 billion in 2025, with total deposits projected at $162-$164 billion [13] - The Zacks Consensus Estimate for MTB's earnings implies year-over-year increases of 10.9% and 13.7% for 2025 and 2026, respectively [14] Bank OZK (OZK) - OZK's NII rose in the first half of 2025, with expectations for continued improvement [17] - The bank has experienced a 10.8% revenue CAGR from 2019 to 2024, driven by loan growth and higher fee income [18] - The Zacks Consensus Estimate for OZK's earnings implies year-over-year rises of 3.6% and 5.9% for 2025 and 2026, respectively [19] Texas Capital Bancshares (TCBI) - TCBI's NII has a CAGR of 4.1% over the past three years, with expectations for continued growth due to rate cuts and improving loan demand [22] - The bank is advancing its strategic plan to improve efficiency and diversify revenues, including acquiring a $400 million healthcare loan portfolio [23] - The Zacks Consensus Estimate for TCBI's earnings implies year-over-year increases of 39.1% and 11.4% for 2025 and 2026, respectively [25]

Market Overview - U.S. equities are experiencing strong upward momentum, with major indexes rising as investors anticipate a Federal Reserve interest rate cut later this week [1][2] - The S&P 500 (SPX) has climbed 0.4%, while the Nasdaq Composite (IXIC) is up 0.5%, both nearing new record highs [2] - The Dow Jones Industrial Average (DJIA) has increased by 43 points, or 0.1%, contributing to the overall positive market sentiment [2] Federal Reserve Focus - The Federal Open Market Committee (FOMC) meeting is the primary focus for market participants, concluding on September 17, 2025 [3] - A 25-basis-point cut in the federal funds rate is widely expected, with the current rate between 4.25% and 4.50% [3] - Investors will closely monitor the updated FOMC members' projections for future interest rate paths through 2026 and 2027 [3] Economic Data Releases - Key economic data releases this week include the Empire State Manufacturing Index, U.S. industrial production, and retail sales data [4] - Additional indicators from the UK and Eurozone will also be observed to shape expectations for future monetary policy [4] Major Stock Movements - Tesla (TSLA) shares surged between 7.2% and 8.5% after CEO Elon Musk disclosed a $1 billion stock purchase, indicating strong insider confidence [5] - Nvidia (NVDA) shares declined by 1.5% to 1.6% following accusations from China regarding antimonopoly law violations related to its acquisition of Mellanox Technologies [5] - Alphabet (GOOGL, GOOG) shares rose over 3%, surpassing a $3 trillion market capitalization, making it the fourth company globally to achieve this milestone [5] - Intel (INTC) shares increased over 4% after trimming its 2025 expense outlook following the sale of its Altera stake [5] - Warner Bros. Discovery (WBD) shares surged by 16.7% amid reports of a potential bid from Paramount Skydance Corporation [5] - RH (RH) shares fell by 4.6% after reporting second-quarter fiscal 2025 earnings that missed estimates [5] - Super Micro Computer (SMCI) gained 2.4% after announcing large-scale shipments of its Nvidia Blackwell Ultra systems [5] Corporate Developments - California Resources Corporation (CRC) and Berry Corporation (BRY) announced an all-stock combination valued at approximately $717 million [9] - Automotive supplier Magna (MGA) secured a significant vehicle assembly deal with XPENG for two new electric vehicle models [9] - Montrose Environmental Group (MEG), Great Lakes Dredge & Dock (GLDD), and KT Corporation (KT) were highlighted as strong buy growth stocks [9]

Canada’s currency is poised to benefit from a smaller interest-rate gap with the US as the nation’s central bank nears the end of its monetary easing cycle while the Federal Reserve gears up for multiple cuts https://t.co/I3Cycl92iE ...