Interest Rate Cut Expectations and Market Impact - Treasury Secretary suggests the Fed should cut rates by 50 basis points next month, with an ultimate reduction of 150 to 175 basis points [1] - Small cap Russell 2000 saw the biggest gains, indicating potential rebound in out-of-favor groups and sectors if rates drop [2] - Market had previously priced in six rate cuts for 2025, but the S&P was significantly lower at that time [3] - Lower rates could benefit commercial real estate, which has been hurt by higher rates [6] - Lower rates lead to higher multiples and stock prices due to discounted cash flow [6] Labor Market and Economic Growth - Treasury Secretary's reasons for rate cuts include a softening job market [3] - There's a contradiction in the administration's stance on the job market revisions [4] - Unemployment is at 42%, higher than last year's below 4% [10] - GDP growth in the first half of 2024 was approximately 125% [10] - Tariffs of 15% or 30% on imports, especially from China, could weigh on growth [11] Investment Strategies - Equities are expected to continue to rally in a 150 basis point cut environment [14] - A barbell strategy is suggested, focusing on high multiple tech stocks and value stocks [14] - Financials and healthcare sectors are identified as potential areas for investment [15]

In short.Seeing these cuts still on the table IMO made it fairly clear this dip was a buying dip.I didn't buy much here, have been long and holding for an extended period of time and will continue to do so.But equities are green now on the day https://t.co/ouRlg7nf3BEasy (@EasyEatsBodega):PPI came in VERY hot.Essentially meaning Inflation is rather high.This does not bode well for rate cuts happening.However, the FedWatch is still anticipating a rate cut in september at 94.5% chanceOctober, currently pricin ...

Market & Rate Cut Expectations - The market anticipates a rate cut in September, with a high probability (96% chance of a 25 basis point cut and a 4% chance of a 50 basis point cut) factored into expectations [2][3] - PPI is expected to align with expectations, similar to CPI, and is unlikely to alter the prevailing narrative of a rate cut [2][3] - The market is primarily focused on the Federal Reserve's actions in September and the potential for a new trade agreement [6] Geopolitical Risk - The meeting between Vladimir Putin and President Trump in Alaska is not expected to pose a direct market risk, despite potential geopolitical and precedent risks [4][5] AI Infrastructure - The discussion highlights the ongoing AI revolution and the investment opportunities within AI infrastructure [6][7] - Companies are announcing tens of billions of dollars of investment into AI infrastructure [9] - AECOM is identified as a potential beneficiary of AI infrastructure spending, providing engineering, consulting, and construction services to data centers [8][9][10] Municipal Bonds - Municipal bonds have faced price struggles year-to-date due to issuers pulling forward new issuance [10][11] - Reduced issuance for the remainder of the year, coupled with consistent demand, is expected to drive prices higher [11] - Tax-free income from municipal bonds is attractive to high net worth investors, making them a favored investment [12] - Investors focused on income potential should prioritize the coupon from bond ETFs and consider buying individual bonds for a dependable income stream and principal protection [13][14]

The UK economy fared better than expected in the second quarter, raising the bar to further rate cuts from the Bank of England https://t.co/OSYWbHqiei ...

You bet. Meanwhile, as mentioned, S&P and NASDAQ hitting fresh record highs this morning. Can the momentum continue as we await another key inflation reading tomorrow.Joining us here at Post 9 with his outlook is Deutsche Bank chief US equity and global strategist Banky Chada. It is these these better than expected inflation reports that that do this to the market. You know, we get we get the expansion, we get the better breath, we get the small caps participating.How sustainable is it. Uh I think it's uh v ...

Market Trends & Rate Cut Expectations - US stock futures are rising, mirroring global equities trading at record highs, fueled by investor optimism for a rate cut at the Fed's September meeting following the July CPI report [1][4] - The market is pricing in a 99.9% chance of a Fed rate cut, with some debate on the street about the likelihood and magnitude of the cut [13][16][41] - Treasury Secretary Besson suggests the Fed should consider a 50 basis point rate cut at its next meeting, advocating for a policy rate at least 1.5% lower [1][2][11] - UBS anticipates rate cuts starting in September, totaling 100 basis points through January, based on expectations of gradual inflation and a stretched consumer [20][21] Company Performance & IPOs - Coreweave shares are declining due to a disappointing earnings outlook linked to the cost of rapid AI data center buildout, despite a nearly fourfold increase in share price since its March IPO [2] - Crypto firm Bullish raised $1.1 billion in an IPO and plans to debut on the New York Stock Exchange [3][33] - Cava's shares are plunging after missing expectations for same-store sales in Q2 and lowering its full-year sales growth forecast to 4%-6% from the previously expected 6%-8% range [26][27][28] - Tencent's revenue jumped 15% in its most recent quarter, driven by increased investment in AI to compete with rivals [36] - Brinker International, parent company of Chili's, reported better-than-expected revenue due to increased demand at Chili's, with same-store sales up 24% [39] AI & Technology - The AI trade continues to drive market momentum, but diversification is recommended to mitigate concentration risk among leading stocks like Nvidia and Microsoft [9][46][48][49] - Investors are closely monitoring Chinese tech firms' AI investments, particularly after Deepseek's LLM breakthrough [36][37] Economic Factors & Fed Policy - The CPI report contains elements that could appeal to both optimists and pessimists, with headline inflation meeting expectations but core inflation hitting a six-month high [7][8] - The White House is pushing back on reports of a wide search for a new Fed chair, emphasizing competence and experience [22][23][24][25]

Group 1 - The SPDR Portfolio S&P 500 ETF (SPLG) has reached a 52-week high and is up 33.4% from its 52-week low of $56.67 per share, indicating strong momentum for investors [1] - The ETF tracks the S&P 500 Index with significant holdings in information technology, financials, and consumer discretionary sectors, each accounting for a double-digit allocation [1] - The ETF charges an annual fee of 2 basis points, making it a cost-effective option for investors [1] Group 2 - The S&P 500 Index recently hit a milestone of 6,400, driven by optimism regarding potential rate cuts and a surge in AI-related stocks [2] - Traders are anticipating a greater than 90% probability of a Federal Reserve rate cut in September, with increasing odds for further cuts in October and December [2] Group 3 - SPLG holds a Zacks ETF Rank 1 (Strong Buy), suggesting that its outperformance may continue in the coming months [3] - Many sectors within the ETF have a strong Zacks Industry Rank, indicating potential for further gains for investors [3]

🇺🇸 U.S. Treasury Secretary Bessent: Rate cuts could start with 50 bps in September.Bullish for Bitcoin 🐂 https://t.co/Q702IrPevr ...

I will share my full thesis on $OPEN in the coming days, but a very simple component is that rate cuts in the second half of the year should be a tailwind for a business that benefits from housing transaction volume.Keep it simple, folks. ...

DANI: 5:00 IN NEW YORK CITY, GOOD MORNING. I'M DANI BURGER WITH YOUR BLOOMBERG BRIEFS, HERE IS WHAT YOU NEED TO KNOW. RISK ON ON RATE CUTS BETS.INFLATION DATA LIFTED EXPECTATIONS OF FED EASING. COULD THAT BE A JUMBO CUT. TREASURY SECRETARY BESSENT SAYS THE FED SHOULD BE OPEN TO A HALF-POINT CUT NEXT MONTH.PRESIDENT ZELENSKYY AND EUROPEAN LEADERS GEAR UP FOR A CALL WITH PRESIDENT TRUMP AHEAD OF THE U.S. RUSSIA SUMMIT. IT WAS THE 16TH RECORD HIGH FOR THE S&P 500 YESTERDAY. WE ARE UP MORE THAN 1% AND WE ADD SO ...