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☆ Wall Street ends up on earnings optimism; eyes remain on Middle East
▼ + stars: | 2023-10-16 | by ( Caroline Valetkevitch | ) www.reuters.com time to read: +3 min

Traders work on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., September 28, 2023. Consumer discretionary (.SPLRCD) led gains among S&P 500 sectors, although all of the sectors were higher on the day. Third-quarter earnings for S&P 500 companies are estimated to have increased 2.2% year-over-year, up from an estimated increase of 1.3% a week earlier, according to LSEG data Friday. At the same time, global leaders are trying to make sure that the Middle East conflict "remains contained," she said. The S&P 500 posted 11 new 52-week highs and 6 new lows; the Nasdaq Composite recorded 33 new highs and 206 new lows.

Persons: Brendan McDermid, Charles Schwab, Russell, Goldman Sachs, Morgan Stanley, Johnson, Quincy Krosby, Patrick Harker, Lululemon, Ankika Biswas, Shashwat Chauhan, Arun Koyyur, Vinay Dwivedi, Aurora Ellis Organizations: New York Stock Exchange, REUTERS, Dow, Nasdaq, Major U.S, Bank of America, Johnson, Netflix, Dow Jones, York, Philadelphia Fed, Activision Blizzard, NYSE, Thomson Locations: New York City, U.S, Major, Gaza, Charlotte , North Carolina, Bengaluru

Traders work on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., September 28, 2023. The S&P 500 and the Nasdaq dropped on Friday as deteriorating consumer sentiment data and the Middle East conflict kept investors away from riskier bets and overshadowed some upbeat earnings from big U.S. banks. Third-quarter earnings for the S&P 500 companies are estimated to grow 2.2% on an annual basis, LSEG data showed. Of the 32 S&P 500 companies that have reported results, 87.5% have surpassed expectations compared with the long-term average of 66.5%. Rival Moderna (MRNA.O) dipped 5.1%Lululemon Athletica (LULU.O) added 5.8% as the sportswear apparel maker is set to join the S&P 500 index this week, replacing Activision Blizzard (ATVI.O).

Persons: Brendan McDermid, Antony Blinken, Pissouros, Goldman Sachs, Morgan Stanley, Johnson, Charles Schwab, Patrick Harker, Jerome Powell, Harker, Austan Goolsbee, Ankika Biswas, Shashwat Chauhan, Arun Koyyur, Vinay Dwivedi Organizations: New York Stock Exchange, REUTERS, Reuters, Pfizer, Dow, Nasdaq, Treasury, XM, Bank of America, Johnson, Tesla, Netflix, Philly, New York, Philadelphia Fed, Federal, Chicago Fed, Dow e, Nvidia, Activision Blizzard, Thomson Locations: New York City, U.S, China, Israel, Gaza, United States, Bengaluru

"If long-term interest rates remain elevated because of higher term premiums, there may be less need to raise the fed funds rate," Logan said. The Dallas Fed president said the economy has been stronger than she had expected, as has been the labor market, and that inflation was still too high despite progress in lowering it. But because Logan ran the New York Fed's bond portfolio for years before she took the top job at the Dallas Fed, her views on what's driving long-term rates higher could carry considerable weight as policymakers weigh their next moves. "The expectation of lower Federal Reserve asset holdings over time implies that other investors will need to hold more long-duration securities, which appears to be one factor among the many contributing to higher term premiums," Logan said. Figuring out how much of the higher long-term rates is due to higher term premiums is complex, she added.

Persons: Lorie Logan, Ann Saphir, Logan, Mary Daly, Julia Coronado, Lorie, she's, Krishna Guha, Guha, Paul Simao Organizations: Federal Reserve Bank, Dallas, Kansas City, REUTERS, Rights, Treasury, Federal Reserve, National Association for Business Economics, Market, San Francisco Fed, Evercore ISI, Dallas Fed, Fed, Thomson Locations: Kansas, Jackson Hole , Wyoming, U.S, York

Re-enter risk premia on what should be 'risk free' bonds. The renewed corporate profits upswing riffs off this relatively robust nominal growth picture too - as do still benign corporate debt premia. However, keeping a lid on 5% nominal GDP may well be what's irking bonds as much as anything. While turning 10-year averages takes some time, nominal GDP growth according to a real time model from the Atlanta Fed is closer to 8% right now. CBO deficit projections to 2030US nominal GDP growth running at 8%?

Persons: York Fed's, Ajay Rajadhyaksha, today's, Treasuries, Fitch, Andrew Heavens Organizations: Treasury, Federal, Fed, The, Barclays, Societe Generale's, Atlanta Fed, Moody's, U.S . AAA, Reuters, Thomson Locations: U.S, Washington, York, 35bp, 150bp, Treasuries, China, Europe

☆ Morning Bid: Nervy bond bounce on soft jobs and oil
▼ + stars: | 2023-10-05 | by ( ) www.reuters.com time to read: +5 min

[1/2] A trader works on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., July 19, 2023. Although both oil and bond yields calmed somewhat overnight, U.S. crude plunged by more than $5 per barrel on Wednesday. The tentative bond bid and shifting interest rate picture stopped the rot in stock markets too, with Wall St stocks rallying on Wednesday and the Nasdaq (.IXIC) staging its biggest daily gain since August. But in a sign of the nervousness, European stock markets stalled again and Wall St futures were back in the red. They do not reflect the views of Reuters News, which, under the Trust Principles, is committed to integrity, independence, and freedom from bias.

Persons: Brendan McDermid, Mike Dolan, Kevin McCarthy, Michael Barr, Mary Daly, Thomas Barkin, Loretta Mester, Lamb Weston, Christina Fincher Organizations: New York Stock Exchange, REUTERS, Nasdaq, Wall, Metro Bank, U.S, Federal, San Francisco Fed, Richmond Fed, Cleveland Fed, Treasury, Brands, Constellation Brands, Reuters, Thomson Locations: New York City, U.S, Wall, York

It needs to translate into changes in economic outcomes," Bostic said in comments to reporters alongside the release of a new policy essay. Part of that adaptation is how the Fed's short-term benchmark is translated ultimately into mortgage rates, corporate bonds yields, and other securities that influence economic activity. In separate comments, Cleveland Fed President Loretta Mester said she similarly is watching how the rise in bond yields will play out, even though she feels the Fed's policy rate still needs to rise. It may well be that the Fed's hawkish rate posture is no longer the primary impetus for the rise in yields. Reporting by Howard Schneider and Dan Burns; Editing by Andrea RicciOur Standards: The Thomson Reuters Trust Principles.

Persons: Federal Reserve Bank of Atlanta Raphael, Bostic, Clodagh, Raphael Bostic, Loretta Mester, Mester, Torsten Slok, Slok, Howard Schneider, Dan Burns, Andrea Ricci Organizations: Federal Reserve Bank of Atlanta, REUTERS, Rights, Federal Reserve, Treasury, Atlanta Federal Reserve, U.S, Cleveland Fed, Apollo Global Management, Reuters, Fitch, Treasury Department, Bank of, Thomson Locations: Dublin, Ireland, Atlanta, China, York

☆ Fears over access to credit hit highest level in more than a decade, New York Fed survey shows
▼ + stars: | 2023-09-11 | by ( Jeff Cox | ) www.cnbc.com time to read: +1 min

The results were part of the New York Fed's Survey of Consumer Expectations for August. Fears of credit access have been rising steadily since early 2022, around the same time that the Fed began raising interest rates. While the Fed worries over higher prices, the inflation outlook was mixed. Expectations for inflation one year and five years out rose just 0.1 percentage point on the month, taking them respectively to 3.6% and 3%. That comes with an unemployment rate of just 3.8%, or 0.1 percentage point above its year-ago level.

Organizations: New York Federal Reserve, York Fed's Survey, Fed Locations: New, York

REUTERS/Brendan McDermid Acquire Licensing RightsORLANDO, Florida, Sept 7 (Reuters) - If you think this time is different, and the post-2008 world of low interest rates and bond yields is over, think again. What's more, Fed officials' longer-term rate projections and New York Fed model estimates of the theoretical long-run equilibrium interest rate - or 'R-Star' - suggest policymakers probably agree. The Fed's persistently low long-term rate outlook and New York Fed's declining R-Star estimates despite the highest inflation, policy rate and bond yields in years, suggest rates and yields won't stay this high for long. With the fed funds target range currently 5.25-5.50%, Fed policy is extremely restrictive, by around 250 basis points or more. The Fed publishes its updated inflation, growth and policy rate outlook on September 20 in the latest Staff Economic Projections.

Persons: Brendan McDermid, Steven Major, HSBC's, Jamie McGeever Organizations: New York Stock Exchange, REUTERS, Rights, U.S ., Bank of America, New York Fed, The New York Fed, Dallas Fed, Reuters, Artificial, Fed, Thomson Locations: New York City, U.S, Rights ORLANDO , Florida, Ukraine, U.S . Republic, China, Japan, York

☆ The average job applicant says they won't accept a role paying less than about $80,000 a year
▼ + stars: | 2023-08-23 | by ( Lakshmi Varanasi | ) www.businessinsider.com time to read: +3 min

The reservation wage is the lowest salary at which a job applicant will accept a new role. A recent survey found that the average reservation wage has risen to nearly $80,000. That's a record high — and shows that while the job market has slowed, workers may still have the upper hand. The results, which reflect the responses of 1,000 people nationwide, show that the average reservation wage — the lowest wage at which someone would accept a new job — was $78,645 as of July. That's an almost $6,000 jump from the average reservation wage reported in July 2022.

Persons: That's, —, It's, Nick Bunker, that's, Yolanda M, Owens, she's Organizations: Service, SCE Labor Market Survey, North America Locations: Wall, Silicon, New York

ORLANDO, Florida, Aug 16 (Reuters) - Investors are hoping policymakers gathering at the Kansas City Fed's annual Jackson Hole Symposium later this month will shed light on one of the murkiest - yet fundamentally most important - tenets of monetary policy: R-star. Even the New York Fed's two most renowned R-star indicators, the Laubach-Williams model and the Holston-Laubach-Williams model, are, metaphorically speaking, miles apart. Martínez-García's estimate of short-term R-star is negative, while the New York Fed staffers' models suggest it has "increased considerably over the past year". The Fed is near the end of its tightening cycle having raised interest rates by 525 basis points to the highest since 2007. Longer-dated real bond yields have shot up to their highest level since 2009 even as market expectations for inflation and Fed rates have held steady.

Persons: Treasuries, Gennadiy Goldberg, Goldberg, Williams, Enrique Martínez, García, Goldman Sachs, JP Morgan, David Mericle, Jackson, John Williams reckons, Jamie McGeever Organizations: Kansas City Fed's, Fed, New, Dallas Fed, TD Securities, York, Dallas and New York Fed, New York Fed, Citi, Reuters, New York Times, Atlanta, Thomson Locations: ORLANDO, Florida, New York, U.S, Dallas

Americans held over $1 trillion in credit card debt in the second quarter of 2023, a new record. The rise in credit card debt helped push total household debt to a record-high $17.06 trillion. For the last seven quarters, credit card balances have grown year over year amid strong consumer spending despite high prices. Despite these record-high credit card balances, there are some silver linings. Are you dealing with an untenable amount of credit card debt, or worried about student loan payments restarting?

Persons: Bankrate, Courtney Alev, Alev, Donald Trump, Joe Biden, Biden, Ted Rossman, Rossman Organizations: Federal Reserve Bank of New, Service, Privacy, New York Fed, Credit Karma, Fed, Consumer Financial, Bureau, Education Department, New, jkaplan Locations: Federal Reserve Bank of New York, Wall, Silicon, It's, York

☆ As credit card debt tops $1 trillion for the first time, 'a huge test' for cardholders is coming
▼ + stars: | 2023-08-08 | by ( Jessica Dickler | ) www.cnbc.com time to read: +2 min

watch nowCollectively, Americans now owe more than $1 trillion on credit cards. Total credit card debt rose nearly 5%, or roughly $45 billion, in the second quarter to a new high of $1.03 trillion, according to a new report on household debt from the Federal Reserve Bank of New York. "One trillion dollars in credit card debt is staggering," Schulz added. "Credit card balances saw brisk growth in the second quarter," Joelle Scally, regional economic principal in the New York Fed's research and statistics group, said in a statement. On the heels of another rate hike last month by the Federal Reserve, the average credit card rate is also more than 20% on average, another all-time high.

Persons: Matt Schulz, LendingTree's, Schulz Organizations: Federal Reserve Bank of New, New York Fed, Federal Reserve Locations: Federal Reserve Bank of New York, York

☆ Consumer credit card debt tops $1 trillion for the first time ever
▼ + stars: | 2023-08-08 | by ( Matthew Fox | ) www.businessinsider.com time to read: +3 min

Consumer credit card debt just topped $1 trillion for the first time ever, according to the Federal Reserve. A recent survey from BankRate found 47% of consumers are carrying credit card debt from month to month. Consumer credit card debt increased 4.6% in the second-quarter to a record $1.03 trillion, compared to $986 billion in the first quarter. Lower-income households were more likely to carry credit card debt from month to month, according to the survey, with 53% of cardholders with annual incomes below $50,000 carrying debt. "Yes, that's a lot of credit card debt, but most people are worth a lot more."

Persons: Joelle Scally, BankRate, Bankrate, they're, Scally, Carson, Ryan Detrick Organizations: Federal Reserve, Federal Reserve Bank of New, New York Fed, Fed Locations: York, Federal Reserve Bank of New York, CreditCards.com

☆ David Rosenberg doubles down on his recession call - and reveals the wild pushback he's faced
▼ + stars: | 2023-08-01 | by ( Theron Mohamed | ) www.businessinsider.com time to read: +5 min

David Rosenberg is sticking with his recession call, despite many other experts backing down. In a client memo, he shared some of the extreme pushback he's received for his gloomy forecasts. David Rosenberg, a leading economist who called both the dot-com and housing crashes, remains fully convinced the US economy is headed for a recession. Recession indicators including the inverted yield curve, The Conference Board's Leading Economic Index, and the New York Fed's recession model are still flashing red. "The impatience and tempestuousness out there do not surprise me, either, having called the markets and the economy for nearly 40 years," he continued.

Persons: David Rosenberg, he's, Michael Burry, Warren Buffett, Merrill, Rosenberg, Merrill Lynch Organizations: Service, Internet, Conference, Biden, North Locations: Wall, Silicon, Houston, York, North American

WASHINGTON, July 6 (Reuters) - New data from the New York Federal Reserve shows underlying inflation may have slowed faster than the headline measures that have kept U.S. central bank officials poised for further interest rate increases. The New York Fed core trend also factors out the food and energy items that central bankers try to look beyond in assessing the direction of inflation. That's because recent data on rents, which have been moderating, gets incorporated faster into the New York Fed's estimates. From a monetary policy perspective, the new estimate could add fodder to arguments for being more cautious about further rate increases. Some policymakers have been concerned that the main measure of core inflation has shown little improvement; the New York Fed's alternate measure suggests that may be the result of temporary factors rather than a more persistent trend.

Persons: Howard Schneider, Chizu Organizations: New York Federal Reserve, Reuters, New, Fed, New York Fed, York, Thomson Locations: York

A short position is essentially a wager an asset's price will fall, and a long position a bet it will rise. Funds expanded their already record net short two-year Treasuries futures position to more than 1 million contracts for the first time. The scale of the move lately is remarkable - the net short position has more than doubled in just two months. Notably, funds' net short two-year Treasuries position now exceeds their net short 10-year Treasuries position by some 354,000 contracts. Reuters ImageIf this is indeed hedge funds betting on an inverted 2s/10s yield curve, they are sitting pretty.

Persons: that's, Jamie McGeever, Tom Hogue Organizations: U.S, Futures Trading Commission, Reuters, Barclays, Thomson Locations: ORLANDO, Florida, U.S . Federal, U.S, York

☆ Wall Street prepares for more gains this month after past week's breakout
▼ + stars: | 2023-06-16 | by ( Scott Schnipper | ) www.cnbc.com time to read: +6 min

For now, it's not a brighter economic picture or an exuberant earnings outlook pushing stocks higher. Another reason that some investors have come back to stocks is simply because the S & P 500 ended the week more than 23% above last October's low. "The next level of resistance is above 4,500 on the S & P. Historically, the market gains 14.5% on average between the 20% threshold level and the next decline of 5% or more. "Inflation peaked in June of last year and has been rapidly declining over the past 12 months. Trading the week after is often treacherous, Hirsch said, with the Dow Jones Industrials falling in 27 of the past 33 years and the S & P 500 down in 23 of 33 years.

Persons: it's, Sam Stovall, Clinton, Wells Fargo, Chris Harvey, Harvey, Jay Hatfield, Price, CarMax, Stovall, Jeffrey Hirsch, Hirsch, Dow Jones Industrials, York Fed's John Williams, Jerome Powell, Philip Jefferson, Lisa Cook, Adriana Kugler, Avid Bioservices, Patterson Cos, Christopher Waller, Michael Bloom, Fred Imbert, Alex Harring Organizations: Fed, CFRA, Microsoft, Infrastructure Capital Management, Consumer, PPI, FedEx, Darden, Dow, Housing, Financial, Enerpac, Avid, Banking, Accenture, Commercial Metals, P, PMI Locations: New York, York, Dublin

☆ Morning Bid: Fearless VIX, China miss, Canada hike?
▼ + stars: | 2023-06-07 | by ( ) www.reuters.com time to read: +4 min

Wall St's 'fear index', the VIX (.VIX) gauge of implied S&P500 equity volatility, closed below 14 on Tuesday for the first time since February 2020 - more than 5 points below its 33 year average. What's more, the OECD saw Fed rates peaking after just one more hike to the 5.25-5.5% range and "modest" cuts next year. Oil prices remain lower on the week despite new Saudi output cut plans and year-on-year prices are still falling at 36%. Events to watch for later on Wednesday:* Bank of Canada key policy interest rate announcement* U.S. April trade balance. Federal Reserve issues Consumer Credit report for April* Britain's Prime Minister Rishi Sunak travels to Washington to meet with U.S. President Joe Biden* U.S. corporate earnings: Campbell Soup, Brown-FormanReuters GraphicsReuters GraphicsReuters GraphicsReuters GraphicsBy Mike Dolan, Editing by Louise Heavens <a href="mailto:mike.dolan@thomsonreuters.com" target="_blank">mike.dolan@thomsonreuters.com</a>.

Persons: Mike Dolan, you'd, eked, Tayyip Erdogan, Mehmet Simsek, Rishi Sunak, Joe Biden, Campbell, Brown, Forman, Louise Heavens Organizations: U.S, Organisation for Economic Cooperation, Development, World Bank, OECD, Bank of Canada, Canadian, Bank of, Federal, Britain's, Forman Reuters Graphics Reuters, Reuters, Thomson Locations: U.S, York, Saudi, Asia, Bank of Canada, Washington

☆ Fed's Williams says world of low interest rates still prevails
▼ + stars: | 2023-05-19 | by ( Michael S. Derby | ) www.reuters.com time to read: +3 min

Williams' remarks took on the technical concept of the natural rate of interest, referred to as R-Star, which the New York Fed defines "as the real short-term interest rate expected to prevail when an economy is at full strength and inflation is stable." Before the pandemic struck, this measure had been historically low, allowing the central bank to keep its interest rate target at fairly low levels. Williams said that given efforts to understand how the pandemic had impacted R-Star, his regional Fed bank will once again provide an estimate on a quarterly basis. To translate R-Star into a real-world rate depends on taking the variable and adding it to the central bank's 2% inflation target. But his comments suggest that once the Fed's battle to contain high inflation is over, it may again at some later time be able to return short-term rates to low levels.

☆ A downbeat economy has left truck drivers facing a slowdown that could get worse than 2008
▼ + stars: | 2023-05-19 | by ( Phil Rosen | ) www.businessinsider.com time to read: +2 min

The slowing US economy is hitting truck drivers, and the sector could be heading for worse conditions than 2008. Freight demand has deteriorated over the last year, and per-mile rates for drivers have plunged since the pandemic boom in 2021. For example, drivers are commanding per-mile rates as low as $1.49 per mile, per FreightWaves. Those rates hovered at $3.01 two years ago, and are worse than the levels seen in a brutal 2019 slowdown. Meanwhile, the American Trucking Associations' advanced seasonally adjusted for-hire truck tonnage index dropped 5.4% in March, marking the largest monthly drop since April 2020.

Global supply chains grew overwhelmed as they struggled to deliver. But Prange said most of his supply chain had stabilized - meaning he was able to get most of what he needed - by the end of 2021. "One of the headwinds is inflation," said Kevin Austin, the supply chain chief for Toyota Motor North America. Meanwhile, the global supply chain snarls of the pandemic have diminished. The New York Fed's Global Supply Chain Pressure Index ticked down to a reading of -1.32 in April, compared to a revised -1.15 in March.

☆ Morning bid: Fed rates to stay higher for longer, debt drama goes on
▼ + stars: | 2023-05-17 | by ( ) www.reuters.com time to read: +3 min

Chicago Federal Reserve President Austan Goolsbee told Bloomberg on Tuesday that it was "too premature" to be discussing interest rate cuts. Loretta Mester, the President at the Cleveland Fed, said they're not at the point where rates can be kept on hold. The chance of a rate cut as early as June has also disappeared, according to the pricing of interest rate futures, having stood at almost 20% a month ago. DEBT CEILING OPTIMISMWith just over two weeks until a possible U.S. debt default unless Congress votes to raise the debt ceiling past its $31.3 trillion limit, talks appear to be heading toward a positive outcome. Biden, who will be travelling to Japan on Wednesday, is set to cut his trip short and skip stops in Australia and Papua New Guinea amid the debt ceiling stand-off.

☆ NY Fed's domestic markets chief to join Bank of New York Mellon
▼ + stars: | 2023-05-15 | by ( Michael S. Derby | ) www.reuters.com time to read: +1 min

May 15 (Reuters) - Bank of New York Mellon Corp on Monday said a top New York Federal Reserve official responsible for domestic markets will join the firm next month in a job focused on financial markets. Nathaniel Wuerffel, who last served as senior vice president at the New York Fed and was the New York Fed's Head of Domestic Markets, will join the bank as Head of Market Structure. His bio said he had been working as chief of the domestic markets group since June 2018. Before joining the New York Fed, Wuerffel worked at the Chicago Fed, starting there in 1998. Wuerffel’s exit comes amid flux in the New York Fed’s top staff.

☆ A recession will unfold this summer and last through the middle of 2024, Evercore chairman says
▼ + stars: | 2023-05-10 | by ( Jennifer Sor | ) www.businessinsider.com time to read: +3 min

A recession is coming this summer and will last until mid-2024, Evercore chairman Ed Hyman said. "I've never forecast a recession this far in advance," he said in an interview with Bloomberg. Signs of trouble brewing in the economy suggest a recession will unfold this summer and last through mid-next year, according to Evercore chairman Ed Hyman. But if we're tightening and other central banks are tightening, it makes our tightening much more aggressive on the economy," he added. "I've never forecast a recession this far in advance," he said, suggesting that the Fed didn't need to keep rates at the current level.

☆ A US recession looks more and more unavoidable as key parts of the economy slow to a crawl
▼ + stars: | 2023-04-26 | by ( Phil Rosen | ) www.businessinsider.com time to read: +4 min

For many months now, I've been having conversations and writing about economic indicators that all point to a recession. The US is in the midst of a "freight recession," meaning there's fewer trucks delivering goods around the country. In a call last week, JB Hunt reported a bad earnings miss, and executives said a recovery for trucking looks uncertain. Outside the trucking sector, the classic recession indicators are blaring, too:The Conference Board's Leading Economic Index just dipped for the 12th consecutive month. The New York Fed's Recession Probabilities Model puts the odds of a downturn at 57%, the highest mark since 1982.

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