Stock indices finished today’s trading session in the green. The Dow Jones Industrial Average (DJIA), the S&P 500 (SPX), and the Nasdaq 100 (NDX) gained 0.73%, 0.67%, and 0.85%, respectively.
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Furthermore, the U.S. 10-Year Treasury yield remained relatively flat at 4.23%, while the Two-Year Treasury yield increased to 5.07%. This brings the spread between them to -84 basis points.
Compared to yesterday, the market is pricing in a higher chance of a higher Fed Funds rate for December 2023. In fact, the market’s expectations for a rate in the range of 5.5% to 5.75% increased to 45.6% compared to yesterday’s expectations of 39.1%.
In addition, the market is now also assigning a 43% probability to a range of 5.25% to 5.5%. For reference, investors had assigned a 49.9% chance yesterday.
Last updated: 1:00PM EST
Stocks are in the green so far in today’s trading session after Jerome Powell stated that more rate hikes could be coming. Furthermore, the University of Michigan released its results on consumer inflation expectations over the next five years. Consumers now expect inflation to be 3%, which is higher than the expected 2.9%.
Taking a look at consumer sentiment, results came in at 69.5, which was lower than the expected 71.2. This is also a decrease compared to last month’s reading of 71.6.
In addition, consumer expectations came in lower than expected. August saw a print of 65.5 versus the forecast of 67.3. This was also a decrease compared to last month’s result of 68.3.
Last updated: 9:30AM EST
Stocks opened higher to end the week with the Nasdaq 100 (NDX) up by 0.6%, while the S&P 500 (SPX) and the Dow Jones Industrial Average (DJIA) inched up by 0.53% and 0.68%, respectively, at 9:30 a.m., EST, August 25.
Meanwhile, asset manager State Street Global Advisors expects a more hawkish stance from Federal Reserve Chair Jerome Powell’s speech at the Jackson Hole today. State Street stated in its note to investors, “The Fed likely isn’t convinced inflation has been beaten. As a result, there won’t be any curtain calls at Jackson Hole. Instead, investors should expect more tough talk from Chairman Powell that the Fed is more committed than ever to defeating inflation.”
First published: 4:00AM EST
U.S. Futures are jittery in the wee hours of Friday morning. Traders are anxious ahead of Federal Reserve Chair Jerome Powell’s speech at the Jackson Hole Economic Symposium this morning. Futures on the Nasdaq 100 (NDX) are down by 0.14%, while those on the S&P 500 (SPX) and the Dow Jones Industrial Average (DJIA) are up by 0.08% and 0.19%, respectively, at 4:00 a.m., EST, August 25.
The Jackson Hole Symposium hosts central bankers and notable financial officials from across the globe. The focus of today’s speech will be on the trajectory of the interest rate and the fight against inflation. Further, Treasury yields continue climbing as stocks plunge in anticipation of Powell’s speech.
Meanwhile, all three major averages finished the trading session in the red yesterday after starting the day upwards, thanks to the rally in Nvidia’s (NVDA) stock. Even so, up to Thursday, both the SPX and Nasdaq Composite were on track to close the trading week on a positive note. Notably, Powell’s speech could drive the market’s direction either way. We expect markets to remain jittery through the day and for the days that follow, as witnessed in prior years. There are no important economic releases or earnings reports scheduled for today.
Following a solid earnings win, Affirm Holdings (AFRM) stock jumped 10% in extended trading yesterday. On the other hand, Intuit (INTU) stock slipped despite reporting strong earnings and guidance. Even shares of Marvell Technology (MRVL) and Nordstrom (JWN) slipped in after-hours trading despite outperforming expectations.
Elsewhere, European indices are inching higher on Friday ahead of speeches from Powell and other Fed officials at the Jackson Hole meeting.
Asia-Pacific Markets End Lower on Friday
Asia-Pacific indices finished lower on Friday in anticipation of the all-important Powell speech at the Jackson Hole meeting today.
Hong Kong’s Hang Seng index and China’s Shanghai Composite and Shenzhen Component indices ended lower by 1.29%, 0.59%, and 1.23%, respectively.
Similarly, Japan’s Nikkei and Topix indices ended down by 2.05% and 0.88%, respectively. Notably, Tokyo’s core inflation (excluding food and gas) for August came in at 2.8%, marginally lower than expected, while headline inflation fell to 2.9% from the 3.2% reading of July.
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