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Now could be a good time to start buying stocks with high dividend yields, according to BMO Capital Markets. The highest-paying S & P 500 stocks have significantly underperformed the index over the last year and a half, even with the rebound they've enjoyed in recent months, said chief investment strategist Brian Belski. They are rated outperform by the firm's analysts and fall within the top 25% of S & P 500 stocks by dividend yield. Digital Realty Trust, which pays a 3.28% dividend yield, owns, develops and operates data centers — which are expected to see surging demand thanks to AI . Host Hotel & Resorts, which owns luxury and upper-upscale hotels, has a 4.92% dividend yield and is down 16% so far this year.
Persons: they've, Brian Belski, Belski, AbbVie Organizations: BMO Capital Markets, Federal, Fed, BMO, Pfizer, pharma, AbbVie, Cerevel Therapeutics, American Electric Power, Southern Company, Utilities, Digital Realty Trust, Host Hotels, Resorts Locations: Southern
In an August 1 note to clients, the bank's top global strategist urged investors to sell stocks when the Federal Reserve issues its first rate cut. Hartnett and his team studied the last 12 rate-cutting cycles going back to 1970 and identified three varieties of rate cuts. Hartnett said surging global central bank rate cuts are signs that the economy is in for a rough stretch. Investors expect the Fed to cut rates for the first time this cycle at its September meeting. "Emergency Fed rate cuts being priced in makes little sense given the economic backdrop in the U.S. and would only serve to destroy policy maker credibility."
Persons: , America's Michael Hartnett, Hartnett, Louis, Jean, Louis Nakamura, Michael Kantrowitz, Piper Sandler, Kantrowitz, Hartnett's, Jim Smigiel Organizations: Service, America's, Federal Reserve, Business, Bank of America Bank of America, Bank of America, Louis Fed, Bank of America's, Global, SEI Locations: U.S
Squeeze on carry trades leave currency markets on edge
  + stars: | 2024-08-06 | by ( ) www.cnbc.com   time to read: +3 min
The Japanese yen and U.S. dollar on display in Yichang, Hubei province, Nov 13, 2023. The yen was 1% lower on Tuesday at 145.78 per dollar in early trading, after rising for five straight sessions and touching a seven-month high of 141.675 on Monday. "Sell-offs that manifest themselves through wild swings in the currency markets are sharp and swift, but usually very short lived," said Jamie Cox, managing partner at Harris Financial Group. "Markets are clearly nervous about the divergent paths central banks are taking, leading to lots of volatility." The dollar index , which measures the U.S. unit versus six rivals, was flat at 102.87 in early trading after touching a seven-month low of 102.15 on Monday.
Persons: Jamie Cox, James Athey, undervaluation Organizations: U.S, Federal Reserve, Federal, Harris Financial, Traders, Bank of Japan, Marlborough Investment Management Locations: Yichang, Hubei province, recessionary, Japan, Switzerland, Tokyo
This report is from today's CNBC Daily Open, our international markets newsletter. CNBC Daily Open brings investors up to speed on everything they need to know, no matter where they are. The Nasdaq Composite dropped 2.43% and is now in correction territory, having declined more than 10% from its recent high. The unemployment rate rose to 4.3%, the highest since October 2021 when the global economy was still reeling from the Covid-19 pandemic. The stocks had to pass several criteria, including receiving five or more earnings upgrades in the past three months.
Persons: Warren Buffett Organizations: New York Stock Exchange, CNBC, Dow Jones Industrial, Nasdaq, Treasury, Federal, Berkshire Hathaway's, Apple . Berkshire, Exxon, Chevron, CNBC Pro Locations: New York City, Apple ., Berkshire, Guyana, U.S, San Ramon , California, Houston , Texas
(This is CNBC Pro's live coverage of Monday's Wall Street chatter as global markets sell off. — Lisa Kailai Han 7:02 a.m.: How long sell-offs typically last Bad news: The current market sell-off may have further to go. — Lisa Kailai Han 6:09 a.m.: Oppenheimer's Stoltzfus: Best to not 'jump to conclusions' Investors need to have a cool head as global markets sell off, according to Oppenheimer's John Stoltzfus. — Fred Imbert 5:51 a.m.: Global markets in an 'aggressive risk-unwind', Vital Knowledge says Fears of a U.S. recession are pressuring global markets, leading investors around the world to sell some of this year's top winners, according to Adam Crisafulli of Vital Knowledge. "Markets are caught in an aggressive risk-unwind as equities plunge around the world, with tech getting hit particularly hard," he wrote in a note Monday.
Persons: Wharton's Siegel, Jeremy Siegel, CNBC's, Siegel, hasn't, it's, … They're, , Lisa Kailai Han, Tom Lee, Lee, Duncan Toms, Toms, Fred Imbert, Victoria Greene, Greene, It's, Nimrit Kang, — Lisa Kailai Han, Dan Ives, Gene Goldman, Gennadiy Goldberg, Ives, Goldman, Goldberg, Oppenheimer's John Stoltzfus, Evercore, Ed Hyman, Hyman, Adam Crisafulli, Crisafulli Organizations: CNBC, Stock, Nikkei, Dow Jones Industrial, Nasdaq, Wharton, Federal Reserve, Fundstrat Global, HSBC, G Squared, Wealth, NorthStar Asset Management, Street, Wedbush, TD Securities, Federal, NASDAQ, U.S, Fed, Global Locations: U.S, Europe, Japan, China
CNBC Daily Open brings investors up to speed on everything they need to know, no matter where they are. Jobs shock hits stocksU.S. stocks plummeted on Friday after a weaker-than-expected jobs report added to fears of a recession. The Nasdaq Composite dropped 2.43% and is now in correction territory, having declined more than 10% from its recent high. Asian stocks plungeAsian stocks continued to sell-off on Monday, with the Japanese market confirming a bear market. The stocks had to pass several criteria, including receiving five or more earnings upgrades in the past three months.
Persons: Topix, Taiwan's Taiex, Warren Buffett Organizations: New York Stock Exchange, CNBC, Dow Jones Industrial, Nasdaq, Treasury, Federal, Nikkei, CSI, Berkshire Hathaway's, Apple . Berkshire, Exxon, Chevron, CNBC Pro Locations: New York City, China, Apple ., Berkshire, Guyana, U.S, San Ramon , California, Houston , Texas
Safe-haven gold firms on U.S. recession fears, rate-cut bets
  + stars: | 2024-08-05 | by ( ) www.cnbc.com   time to read: +2 min
Two Argor-Heraeus SA 250 gram gold bars at Solar Capital Gold Zrt. Gold prices drifted higher on Monday, aided by worries that the United States could be headed for a recession and rising bets that the Federal Reserve will likely need to start cutting interest rates aggressively. Spot gold rose 0.14% to $2,446.83 per ounce, as of 0519 GMT, after falling 1% earlier in the session. "Gold is picking up safe-haven flows, with financial markets in a risk-averse mindset to start the week," said Tim Waterer, chief market analyst at KCM Trade. Share markets tumbled and bonds rallied in Asia as U.S. recession fears sent investors rushing from risk assets.
Persons: Tim Waterer, Thomas Barkin Organizations: Heraeus, Solar, Federal Reserve, KCM, Richmond Fed, P Global, Pentagon Locations: Budapest, Hungary, United States, Asia, U.S, Iran
Last week, 30-year mortgage rates averaged 6.28%, and they're even lower today, according to Zillow data. What does this mean for mortgage rates? See more mortgage rates on Zillow Real Estate on ZillowMortgage Refinance Rates TodayMortgage type Average rate today This information has been provided by Zillow. See more mortgage rates on Zillow Real Estate on ZillowMortgage CalculatorUse our free mortgage calculator to see how today's mortgage rates will affect your monthly and long-term payments. As inflation slows and the Federal Reserve is able to start cutting the federal funds rate, mortgage rates are expected to trend down as well.
Persons: Jerome Powell, Fannie Mae Organizations: Federal, Zillow, Federal Reserve, Mortgage, Association, ARM Locations: Chevron
AdvertisementSt. Louis FedDespite the Sahm Rule's impressive history, it is sometimes criticized because it fails to account for rising labor participation, which can raise the unemployment rate. In addition to downcast labor market data, the ISM Manufacturing Index fell further into contraction territory this week, signaling that US manufacturing continues to slow. The market's direction also depends on how investors interpret interest rate cuts alongside future data. Fed funds rate futures markets are now pricing in a 50-basis-point cut in September, according to the CME FedWatch Tool. AdvertisementHartnett and his team analyzed Fed rate-cutting cycles and identified three different types of rate cuts — cuts into a soft landing, cuts into a hard landing, and panic cuts, which are due to a credit event or some sort of Wall Street crisis.
Persons: , Claudia Sahm —, Louis Fed, Piper Sandler, Tom Essaye, Jack McIntyre, Lara Castleton, Janus Henderson, Michael Kantrowitz, we've, Kantrowitz, Michael Hartnett, Hartnett Organizations: Service, Bureau of Labor Statistics, Business, Labor, Brandywine Global, ISM, Nasdaq, Fed, Janus, Janus Henderson Investors, Bank of America, Fund
Why the stock market is going berserk today
  + stars: | 2024-08-02 | by ( Jennifer Sor | ) www.businessinsider.com   time to read: +4 min
The stock market is in shambles on Friday, with all three major indexes falling more than 2%. AdvertisementThe US stock market has plunged into chaos as investors digest a streak of negative economic data and disappointing mega-cap-tech earnings. Months ago, signs of a slowing economy would bolster expectations for Fed rate cuts, which are seen as rocket fuel for stocks. "Pressure will escalate on the Federal Reserve as market interest rates will continue the attempt to force their hand." She added: "A September rate cut is in the bag and the Fed will be hoping they haven't, once again, been too slow to act."
Persons: They're, , John Lynch, Seema Shah, Ryan Detrick, Carson Organizations: Amazon, Service, Investors, Intel, Comerica Wealth Management, Federal Reserve, Asset Management, York Fed Locations: New York
New York CNN —Stocks slid Friday as a disappointing jobs report added to fears that the US economy is weakening. Stocks have also whipsawed in recent days as investors also digested the Federal Reserve’s July policy meetings and Big Tech earnings reports. Big Tech earningsInvestors have also parsed a mixed bag of Big Tech earnings this week. Shares of Apple, which reported in-line earnings but missed sales expectations Thursday evening, are up 2.1%. Investors have in recent weeks moved out of the Magnificent Seven tech stocks that powered the market to repeated record highs this year.
Persons: Stocks, Dow, That’s, , David Russell, Jerome Powell, ” Powell Organizations: New, New York CNN, Nasdaq, of Labor Statistics, Institute for Supply Management, Big Tech, Federal Reserve, Microsoft, Apple, Amazon, Meta, Intel Locations: New York, tamping
Technical signals suggest downside is limitedThere isn't much evidence that poor-performing areas of the market, like small-cap stocks, have peaked, Newton said. Meanwhile, Treasury yields have fallen in recent months as traders anticipate Fed rate cuts, which is typically bullish for stocks, he added. Advertisement"Thus, looking to buy dips makes sense technically," he said, adding that small-cap stocks looked "certainly appealing" after their recent slide. Fed rate cuts will mark a turning point in the marketThat's because rate cuts are expected to ease borrowing costs across several sectors. Small-cap stocks are flashing bullish signalsThe Russell 2000 hit a 30-month high in July, something that's only happened nine times over the past 45 years.
Persons: Fundstrat's Tom Lee, Lee, , Tom Lee, who's, Mark Newton, Newton, I'm, Russell, That's Organizations: Tech, Service, Fed, Wall Street Locations: Wall
The S & P 500 ended the week down by 2%. As of Friday, the Nasdaq Composite was more than 10% below its recent high, while the S & P 500 was down by 5.7%. Markets were last pricing in a 71% chance of a half percentage point rate cut in September, up from 22% on Thursday, according to the CME FedWatch Tool . Brands , Fidelity National Information Services , Uber Technologies , Marathon Petroleum , Caterpillar Wednesday Aug. 7 3 p.m. Consumer Credit (June) Earnings: Costco Wholesale , Warner Bros. Discovery , Occidental Petroleum , Ralph Lauren , CVS Health , Hilton Worldwide Holdings , Walt Disney Company Thursday Aug. 8 8:30 a.m.
Persons: Stocks, payrolls, Bill Hornbarger, Benjamin F, Edwards, Russell, Claudia Sahm, selloff, Michael Kantrowitz, Piper Sandler, Kantrowitz, Jan Hatzius, Goldman Sachs, Hatzius, CNBC's, Eli Lilly, Ralph Lauren, Martin Marietta Organizations: Nasdaq, Treasury, Investors, Federal Reserve, Walt Disney Company, Caterpillar, Costco, Micro Computer, PMI, PMI Services, Services PMI, Simon Property Group, Diamondback Energy, Tyson Foods, Devon Energy, Airbnb, Wynn Resorts, TransDigm, Brands, Fidelity National Information Services, Uber Technologies, Marathon Petroleum, Consumer Credit, Costco Wholesale, Warner Bros, Discovery, Occidental Petroleum, CVS Health, Hilton Worldwide Holdings, Gilead Sciences, Akamai Technologies, News Corp, Paramount Global, Expedia, Martin, Martin Marietta Materials Locations: Fortinet, Devon
US stocks nosedived on Thursday after several discouraging economic data points. The ISM manufacturing index dropped from 48.5% in June to 46.8% in July, marking an eight-month low. Investors are pricing in a 100% chance of Fed rate cuts in September, according to the CME FedWatch tool. Meanwhile, new data shows ISM manufacturing slid further into contraction territory in July. Jensen Huang just got $12 billion richer in a single day as Nvidia's stock soared on Wednesday.
Persons: , Jerome Powell, Jensen Huang Organizations: Service, Reuters
Indexes slid on Thursday despite a strong earnings report from Meta that sent the stock soaring. New jobless-claims data beat expectations and approached a one-year high, stoking economic concern. Investors are pricing in a 100% chance of Fed rate cuts in September. Shares of Meta soared as much as 11% after the company beat earnings estimates in the most recent quarter and raised its full-year revenue guidance. Qualcomm also beat earnings expectations but saw its stock down 3% Thursday.
Persons: , Jerome Powell, Powell Organizations: Service, Meta, Wednesday's, Qualcomm, Here's Locations: Meta
See more mortgage rates on Zillow Real Estate on ZillowMortgage CalculatorUse our free mortgage calculator to see how today's mortgage rates would impact your monthly payments. 30-Year Fixed Mortgage RatesThe average 30-year fixed mortgage rate was 6.78% last week, according to Freddie Mac. 15-Year Fixed Mortgage RatesLast week, average 15-year mortgage rates were 6.07%, a two-basis-point increase from the previous week, according to Freddie Mac data. Mortgage rates started ticking up from historic lows in the second half of 2021 and increased over three percentage points in 2022. Once the Fed cuts rates, mortgage rates should fall even further.
Persons: they've, you'll, Freddie Mac, it's Organizations: Federal Reserve, National Association of Realtors, Zillow Locations: Chevron
US stocks surged as chipmakers lifted tech shares ahead of the Federal Reserve's rate decision. Fed Chair Powell's guidance will be crucial, with market sentiment hinging on his remarks. All eyes will be on Fed Chair Powell, who is expected to issue guidance on rate cuts in prepared remarks. Advertisement"Tonight's press conference from Fed Chair Jerome Powell may provide a catalyst for the next move. "A too-strong signal of a coming September rate cut may scare traders into thinking that the Fed sees abrupt economic weakness ahead.
Persons: , Morgan Stanley, Powell, Jerome Powell, David Morrison, Thierry Wizman Organizations: Service, Nvidia, AMD, Federal Reserve, Fed, Trade Nation, Macquarie
Certain areas of the stock market that benefit from lower rates could see a boost. AdvertisementInstead, plug some money into longer-duration bonds to lock in higher returns while they're still around, Milan said. In addition to tying down solid returns, longer-duration bonds could also appreciate when rates fall, he said. AdvertisementLook at rate-sensitive areas of the stock marketCertain areas of the stock market should also benefit from Fed rate cuts. But investors should keep their eye on the labor market the more the Fed cuts rates, Young Thomas said.
Persons: , Daniel Milan, they're, Ed Mahaffy, Mahaffy, Robert Phipps, Bernstein, Liz Young Thomas, Shmuel Shayowitz, Kristy Kim, Young Thomas Organizations: Service, Federal Reserve, Business, Cornerstone Financial Services, Treasury, ClientFirst Wealth Management, Corporate, Per Stirling Capital Management, Bloomberg, Bond, Index, Fed, Vanguard, ®, Schwab, Fidelity Locations: Michigan, Milan, TreasuryDirect, TomoCredit
Central bankers said they had more confidence inflation was back on track to 2%. Markets are pricing in a 100% chance of a rate cut in September, per the CME FedWatch tool. AdvertisementUS stocks surged on Wednesday, driven by a rally in the tech sector and dovish comments from the Federal Reserve. The second quarter's inflation readings have added to our confidence, and more good data would further strengthen that confidence," Fed Chair Powell said in prepared remarks. Markets are now pricing in with certainty that the Fed will cut rates in September, according to the CME FedWatch tool.
Persons: , Powell, Philip Straehl, Morgan Stanley Organizations: Fed, Service, Federal Reserve, Nasdaq, Morningstar Wealth, AMD, Nvidia
Read previewThe nation's central bank didn't give interest rate relief to Americans — yet. On Wednesday, the Federal Open Market Committee announced it would be leaving interest rates unchanged, continuing the pause that began last fall. And with the labor market slowing down while avoiding a recession, the Fed might have the evidence it needs to cut interest rates at its next meeting in September. However, predictions point to a rate cut — CME FedWatch, which estimates probabilities of interest rate changes based on the markets, showed markets think it's far more likely than not that rates will ease. Related storiesThe high interest rates have meant it's more expensive for Americans to borrow money for things like mortgages, credit cards, and auto loans.
Persons: , Jerome Powell, Powell, Michele Raneri, Donald Trump —, Trump, Elizabeth Warren, John Hickenlooper, Sheldon Whitehouse Organizations: Service, Federal, Market Committee, Business, Fed, TransUnion, Fox News, Democratic Locations: May's, Sens
It's safe to say that Americans can count on an interest rate cut pretty soon, but probably not this week. On Wednesday, the Federal Open Market Committee will announce its next interest rate decision, and it's once again expected to hold rates steady. However, the FOMC's September meeting could finally bring Americans the relief they've been waiting for — CME FedWatch showed markets think it's all but certain the Fed will cut rates that month. Lower interest rates would make borrowing more affordable for consumers and businesses alike. "You have kept interest rates too high for too long: it is time to cut rates," they wrote.
Persons: it's, Claudia Sahm, Greg McBride, There's, Jerome Powell, Powell, Sahm, Matt Colyar, September's, Elizabeth Warren, Jacky Rosen, John Hickenlooper Organizations: Service, Federal, CME FedWatch, Business, New Century Advisors, Fed, Banking, Housing, Urban Affairs, Democratic, Moody's
US stocks rose as investors anticipate key economic data and earnings results this week. Major companies like Apple, Microsoft, and Amazon will release second-quarter earnings results this week. AdvertisementUS stocks edged higher on Monday as investors prepare for a big week ahead filled with important economic data and earnings results. Investors are instead expecting a 100% chance that the Fed cuts interest rates at its September FOMC meeting. Finally, it's a big week for earnings results, with about 34% of S&P 500 companies set to release their second-quarter results this week.
Persons: , Steve Sosnick Organizations: Apple, Microsoft, Service, Interactive, Here's
The stock market is about to see a major shift once the Fed cuts rates, Jeremy Siegel said. The top economist thinks value stocks could start outperforming growth stocks once the Fed eases policy. Cooling inflation data supports a Fed rate cut by September, Siegel predicted. The Wharton School finance professor pointed to opportunity lurking in value stocks, an unloved group of the market that's underperformed this year when compared to growth stocks. Growth stocks have outperformed partly due to Wall Street's AI craze, which has ignited investor fervor for growth stocks, like mega-cap tech firms.
Persons: Jeremy Siegel, Siegel, , Powell Organizations: Service, Wharton School, CNBC
This could cause mortgage rates to move up or down slightly. If Fed officials signal that they could start lowering the federal funds rate soon, mortgage rates could ease. This would remove a lot of the upward pressure off of mortgage rates and allow them to trend down. See more mortgage rates on Zillow Real Estate on ZillowMortgage Refinance Rates TodayMortgage type Average rate today This information has been provided by Zillow. See more mortgage rates on Zillow Real Estate on ZillowMortgage CalculatorUse our free mortgage calculator to see how today's mortgage rates will affect your monthly and long-term payments.
Persons: Fannie Mae Organizations: Zillow, Federal Reserve, Mortgage, Association, ARM Locations: Chevron
Investors who are camped out in cash are nabbing sweet yields, but the clock is ticking on that attractive income. Money market fund assets totaled $6.14 trillion as of the week ended July 24, according to the Investment Company Institute . The largest money market funds are offering an annualized 7-day current yield of 5.12%, per the Crane 100 Money Fund Index. "Investors must also remember that the liquid securities held in money market funds have maturities capped at slightly over a year," he said. While these short-term bonds may be an attractive alternative to hiding out in cash, investors should avoid making them the lion's share of their fixed income holdings.
Persons: Daniel Siluk, Janus Henderson, Matthew Mish, Siluk Organizations: Investment Company Institute, Federal, UBS, SEC, BBB, Treasury Bond ETF
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