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☆ A lone dissenting vote on the Fed's rate cut marks the first split by a central bank governor in 2 decades
▼ + stars: | 2024-09-18 | by ( Kelly Cloonan | ) www.businessinsider.com time to read: +1 min

The Fed's decision to cut rates by 50 basis points garnered support from 11 of 12 voting members. Fed governor Michelle Bowman dissented, marking the first split by a central bank governor since 2005. Bowman advocated for a smaller, 25 basis point cut. Federal Reserve Governor Michelle Bowman dissented, advocating for a smaller, 25 basis point cut as the committee opted for a large, 50 basis point cut. Bowman's dissent marks the first time a central bank governor has strayed from consensus on an interest rate decision since 2005.

Persons: Michelle Bowman, Bowman, — Organizations: Service, Federal, Business

☆ Gen Z's love of discount stores could send these 3 retail stocks soaring as much as 18%, Bank of America says
▼ + stars: | 2024-09-18 | by ( Kelly Cloonan | ) www.businessinsider.com time to read: +3 min

Millennials and Gen Z are increasingly shopping at discount stores like TJ Maxx, Burlington, and Ross. AdvertisementGen Z wants more bang for their buck, and their love of a good deal could drive shares of some discount retailers up nearly 20%, Bank of America says. AdvertisementThe report from BofA on Wednesday attributes the rise in popularity among discount stores to inflation weariness. The analysts see Burlington and Ross Stores shares rising 16% and 18% from Wednesday highs, respectively. "Off-price has attracted the customer, helped by the quest for value amidst persistent multi-year inflation pressures," Bank of America's analysts wrote.

Persons: Millennials, TJ Maxx, Ross, —, Ross . Younger Organizations: Service, Bank of America, TJ Maxx, Goods, Burlington, Ross Stores, Bank of Locations: Burlington, Millennials, BofA

☆ Home buyers are holding their breath for rate cuts as existing home sales plunge to lowest since the pandemic
▼ + stars: | 2024-09-18 | by ( Kelly Cloonan | ) www.businessinsider.com time to read: +1 min

Existing home sales in August reached their lowest level since May 2020, according to Redfin. Redfin says buyers are waiting to see if mortgage rates fall further as the Fed cuts interest rates. Go to newsletter preferences Thanks for signing up! AdvertisementBuyers are back on the sidelines as they wait to see if mortgage rates fall further after , a Redfin report shows. That's the lowest level since the pandemic stalled home sales in May 2020, and discounting that month, it's the lowest level on record since 2012.

Persons: Redfin, — Organizations: Service, Business

☆ The more markets price in a jumbo rate cut, the more likely the Fed is to deliver, analyst says
▼ + stars: | 2024-09-18 | by ( Kelly Cloonan | ) www.businessinsider.com time to read: +1 min

Traders see heightened odds of a big initial rate cut from the Federal Reserve this week. As markets price in rising odds of a 50 basis point cut, the Fed may be more likely to deliver, BMO's Ian Lyngen says. He says markets pricing an 80% chance of a big rate cut could sway the Fed. AdvertisementInvestors have been pricing in rising odds of a 50 basis point interest rate cut from the Federal Reserve. And as the market increasingly positions for a jumbo cut, the Fed may be more likely to deliver, according to BMO's head of US rates strategy Ian Lyngen.

Persons: BMO's Ian Lyngen, —, Ian Lyngen, we'll, Lyngen Organizations: Federal Reserve, Service, Business

☆ The US economy is strong enough that Fed rate cuts aren't even warranted, JPMorgan strategist says
▼ + stars: | 2024-09-17 | by ( Kelly Cloonan | ) www.businessinsider.com time to read: +1 min

Most traders expect the Federal Reserve to front-load easing with a big initial rate cut this week. However, JPMorgan strategist Oksana Aronov says a rate cut "is not necessarily even warranted." AdvertisementThis week, the Federal Reserve is expected to decide on the size of its highly-anticipated rate cut. Yet, one strategist says a rate cut isn't necessary at all given the relative strength of the economy. "I'd say that a cut is not necessarily even warranted, given that we're not really seeing a broad-based weakening outside of a more reasonable labor market," JPMorgan strategist Oksana Aronov said.

Persons: Oksana Aronov, — Organizations: Federal Reserve, Service, Business

☆ Investors are pouring into this defensive corner of the stock market amid fears of an economic slowdown
▼ + stars: | 2024-09-17 | by ( Kelly Cloonan | ) www.businessinsider.com time to read: +3 min

Analysts are increasingly recommending defensive stocks to blunt the impact of an economic slowdown. The S&P 500's consumer staples sector has risen more than 4% in the last month. AdvertisementAmid fears of a recession and increased market volatility, analysts have been pointing to defensive stocks as a safe bet to hedge macro risk. Among defensive sectors — which include things like real estate and financials — investors recently have been pouring into consumer staples in particular. With the Federal Reserve likely to finally cut rates at its meeting this week, defensive stocks could be poised for further growth.

Persons: —, Morgan Stanley's, Mike Wilson, Wilson, that's, Savita Subramanian, Subramanian Organizations: Service, Retailers, Walmart, Target, Bank of America, P Global Semiconductor, Financial Times, Bloomberg, Federal Reserve Locations: cyclicals

☆ 'Boring is good': Here's where investors should look for safety amid rising uncertainty, according to BofA's stock strategy chief
▼ + stars: | 2024-09-16 | by ( Kelly Cloonan | ) www.businessinsider.com time to read: +1 min

Traders should look to financials, utilities, and real estate stocks, Savita Subramanian says. Subramanian pointed to large-cap value stocks, and said they "look incredibly attractive." Go to newsletter preferences Thanks for signing up! download the app Email address Sign up By clicking “Sign Up”, you accept our Terms of Service and Privacy Policy . AdvertisementTraders should look to avoid risks and hide in safe dividend stocks as the market faces rising uncertainty, Bank of America chief equity strategist Savita Subramanian said.

Persons: Savita Subramanian, Subramanian, — Organizations: Service, of America, Bloomberg Television, Business

☆ Apple leads tech sell-off after analyst warns of light iPhone 16 demand
▼ + stars: | 2024-09-16 | by ( Kelly Cloonan | ) www.businessinsider.com time to read: +3 min

Apple shares were down 3% on Monday, leading a drop in the wider tech sector. The slide came after analyst Ming-Chi Kuo warned of light iPhone 16 demand. The lack of demand for the newest iPhone is likely because Apple has yet to roll out its most anticipated new feature, Apple Intelligence, Kuo said. Advertisement"One of the key factors for the lower-than-expected demand for the iPhone 16 Pro series is that the major selling point, Apple Intelligence, is not available at launch alongside the iPhone 16 release," Kuo said in a Sunday note. "In that case, I believe that Apple will implement more aggressive iPhone product strategies in 2025 to stimulate market demand," Kuo said.

Persons: Ming, Chi Kuo, —, TF International Securities analyst Ming, Kuo Organizations: Apple, Semiconductor, Nasdaq, Service, TF International Securities analyst, Apple Intelligence, Dow Jones, Micron, Broadcom, Inc, Taiwan Semiconductor Manufacturing Company

☆ 'Time is running out' for China to hit its growth targets, economist says
▼ + stars: | 2024-09-16 | by ( Kelly Cloonan | ) www.businessinsider.com time to read: +1 min

With no strong growth stimulus, it's unlikely China reaches its 5% GDP target, economist Yingrui Wang says. Wang warns that China could slip into a "yawning demand-deficient deflation trap" going into 2025. download the app Email address Sign up By clicking “Sign Up”, you accept our Terms of Service and Privacy Policy . AdvertisementWith new weak economic data and no clear sign of a stronger growth stimulus, China most likely won't reach its growth targets by year-end, AXA Investment Managers economist Yingrui Wang says. "Time is running out for China this year to achieve its growth targets, but also to avoid a more protracted slowdown," Wang wrote in a Monday note.

Persons: Yingrui Wang, Wang, — Organizations: Service, AXA Investment, Business Locations: China

☆ The office market is in trouble. Lower interest rates might not be enough to save it.
▼ + stars: | 2024-09-15 | by ( Kelly Cloonan | ) www.businessinsider.com time to read: +4 min

Read previewOffices have been the weak spot in the commercial real estate market since the pandemic gave rise to widespread remote work and caused companies to reassess how much space they need. The Federal Reserve's likely interest rate cut, expected at the end of its meeting on September 18, could give office owners some relief with lower interest rates when they refinance. But that doesn't mean they're in the clear, according to commercial real estate experts. Right now, most commercial real estate loans come from small, regional banks, but that could change. AdvertisementYet even with the weakness in the office market, lower interest rates are a net positive for the industry, economist Richard McGahey says.

Persons: —, Lisa Pendergast, Pendergast, Lisa Knee, Knee, It's, Richard McGahey, McGahey Organizations: Service, Business, CRE Finance

☆ Pets, sports, and Disney might end up rescuing China's ailing consumer economy
▼ + stars: | 2024-09-13 | by ( Kelly Cloonan | ) www.businessinsider.com time to read: +4 min

Read previewA family dog, tennis, and Disney Shanghai's LinaBell character have one thing in common — they might end up pulling China out of a long slump in consumer demand. Those rapidly growing areas are poised to drive a rebound in China's anemic consumer spending, Bank of America analysts say. China's pet economy is seeing outsize spending as pets come to occupy a greater place of prominence in households. Finally, the analysts see significant growth potential in the country's "cultural IP" economy — spending on books, movies, and experiences based on fictional characters or storylines. China's economy has been stuck in the doldrums amid weak consumer spending.

Persons: —, that's Organizations: Service, Disney, Bank of America, Business, Consumers Locations: China

☆ 'We're only in 1996': Why the AI boom is still in its earliest days, according to Bank of America
▼ + stars: | 2024-09-12 | by ( Kelly Cloonan | ) www.businessinsider.com time to read: +3 min

The AI boom is still in its infancy, following the path of the internet in the 1990s, BofA said. AI's impact will be felt sooner than past tech booms, the bank says. Skepticism about AI has mounted recently as investors get impatient to see AI returns. "Skeptics declare that GenAI's revenue potential doesn't justify the current level of AI infrastructure investment," the report says. On Tuesday, Morgan Stanley chief US equity strategist Mike Wilson said the AI investment theme has been "overcooked," and suggested investors should retreat into defensive stocks.

Persons: BofA, —, Morgan Stanley, Mike Wilson Organizations: Service, Bank of America, ChatGPT

☆ This year's 'offseason' could be much busier for the housing market as buyer competition heats up, Zillow says
▼ + stars: | 2024-09-12 | by ( Kelly Cloonan | ) www.businessinsider.com time to read: +1 min

Late summer is typically the start of the housing market's "offseason," marked low buying activity. However, this year, the market may see an unusually high level of activity amid lower mortgage rates. AdvertisementThe late summer and early fall are typically part of the housing market's "offseason," marked by low buying and selling activity. But this year, the season could see an unusually high amount of activity as buyers look to lock in lower mortgage rates, a new Zillow report finds. "Lower rates could stall or slow the cooldown in housing market activity that typically takes place this time of year, because right now buyers are more likely to be motivated by lower rates than sellers are," the report says.

Persons: — Organizations: Service, Business

☆ Stock market today: Indexes rise as investors assess producer inflation and jobless claims data
▼ + stars: | 2024-09-12 | by ( Kelly Cloonan | ) www.businessinsider.com time to read: +2 min

Indexes rose Thursday as investors digested new inflation and labor market data. Jobless claims last week rose slightly following two weeks of consecutive declines. The producer price index logged a 0.2% monthly rise, in-line with expectations. In the second inflation reading of the week, the producer price index rose 0.2% from July to August, in line with expectations. This corner of the stock market is set to outperform once the Fed starts cutting interest rates, Goldman Sachs says.

Persons: —, Harris, Ed Yardeni, Goldman Sachs Organizations: Service, Federal Reserve, Labor Department, Here's, Trump

☆ Cooling jobs data might beat out inflation in forcing the Fed to deliver a big rate cut, Goldman Sachs CEO says
▼ + stars: | 2024-09-12 | by ( Kelly Cloonan | ) www.businessinsider.com time to read: +1 min

Cooling labor data could still lead the Fed to cut rates by 50 basis points, Goldman Sachs' David Solomon says. "I think the percentage chance is in the low 30s," Solomon said of a 50 basis point cut. The slightly hotter August CPI reading tilted the odds further in favor of a 25 basis point cut. AdvertisementIt wasn't long ago that Goldman Sachs CEO David Solomon forecasted there could be no rate cuts from the Federal Reserve this year. Now, even as the latest inflation data has most investors pricing in a 25 basis point cut in September, Solomon says a larger cut could still be in the cards.

Persons: Goldman Sachs, David Solomon, Solomon, — Organizations: Service, Federal Reserve, CNBC, Business

☆ The AI theme is 'overcooked' and investors should take shelter in quality defensive stocks, Morgan Stanley's CIO says
▼ + stars: | 2024-09-11 | by ( Kelly Cloonan | ) www.businessinsider.com time to read: +3 min

In the meantime, they should take shelter in quality defensive stocks, Morgan Stanley says. We just got overcooked on the whole AI theme," Wilson said. AdvertisementWith the AI rally fading for now, Wilson says investors are waiting for a new theme to emerge, and taking shelter in "quality defensive stocks" in the meantime. "In our view, a slowing labor market is consistent with a late cycle backdrop and quality + defensive leadership," Wilson wrote. AdvertisementLast month, Wilson's team added three new quality defensive stocks to its "Fresh Money Buy List," which now totals nine stocks.

Persons: Morgan Stanley's Mike Wilson, Wilson, —, they're, Morgan Stanley, Mike Wilson, Morgan, We're Organizations: Service, Bloomberg Surveillance, Nvidia, Semiconductor

☆ This corner of the stock market is set to outperform once the Fed starts cutting interest rates, Goldman Sachs says
▼ + stars: | 2024-09-11 | by ( Kelly Cloonan | ) www.businessinsider.com time to read: +4 min

Mid-cap stocks are poised for greater growth than small- and large-caps, Goldman Sachs says. They forecast a 13% return on mid-caps in the next year after rate cuts. AdvertisementThere's one area of the stock market that is likely set for outsized growth after rate cuts: the mid-cap shares. Mid-cap equities have historically seen stronger growth in the year after rate cuts compared to large- and small-caps, analysts from Goldman Sachs say. Goldman Sachs expects the Fed to cut interest rates by 25 basis points at its policy meeting next week, followed by 25 basis points in November and December.

Persons: Goldman Sachs, —, Russell, Goldman Organizations: Service

☆ The possibility of stagflation hitting the US economy isn't off the table, JPMorgan chief Jamie Dimon says
▼ + stars: | 2024-09-10 | by ( Kelly Cloonan | ) www.businessinsider.com time to read: +1 min

JPMorgan Chase CEO Jamie Dimon said the worst outcome for the US economy is stagflation. Speaking at a Tuesday conference, Dimon said he "wouldn't take it off the table." Go to newsletter preferences Thanks for signing up! AdvertisementEven as inflation approaches the Federal Reserve's target, JPMorgan Chase CEO Jamie Dimon says stagflation is still a possibility. "I would say the worst outcome is stagflation — recession, higher inflation," Dimon said.

Persons: Jamie Dimon, Dimon, —, stagflation Organizations: JPMorgan, Service, of Institutional, CNBC, Business

☆ No bear market for stocks in sight even as macro and policy uncertainty threaten further volatility, Goldman Sachs says
▼ + stars: | 2024-09-10 | by ( Kelly Cloonan | ) www.businessinsider.com time to read: +3 min

Higher valuations, a mixed macro outlook, and policy uncertainty raise the risk of further declines for stocks. Yet, odds of a bear market are low amid a strong private sector and coming rate cuts, Goldman Sachs says. AdvertisementMacro and policy uncertainty have raised warning signs for further volatility for stocks in recent weeks, but the risk of a steeper correction into bear market territory looks remote, Goldman Sachs analysts said. According to the bank, there's an elevated risk that investors pullback amid lofty valuations, a mixed macro outlook, and policy uncertainty. The firm's outlook comes as indexes have been rattled in recent months by volatility stemming from weaker-than-expected macro data.

Persons: Goldman Sachs, Goldman, — Organizations: Service, Fed

☆ 3 reasons China's economy is poised to break out of its long slump, according to Goldman Sachs
▼ + stars: | 2024-09-09 | by ( Kelly Cloonan | ) www.businessinsider.com time to read: +1 min

But the country could see growth pick up this fall, Goldman Sachs' chief China economist says. Hui Shan pointed to fiscal easing, strong export momentum, and subsiding weather-related risks. Go to newsletter preferences Thanks for signing up! AdvertisementAfter a long downturn, China's economy may be poised for a turnaround, Goldman Sachs says. Goldman's chief China economist Hui Shan pointed to fiscal easing, strong export momentum, and subsiding weather-related risks as reasons to believe the country's fortunes could soon change.

Persons: Goldman Sachs, Hui Shan, —, Shan Organizations: Service, Business Locations: China

☆ Rate cuts won't prevent a recession and the economy is deteriorating 'quite rapidly,' investment strategist says
▼ + stars: | 2024-08-23 | by ( Kelly Cloonan | ) www.businessinsider.com time to read: +3 min

Read previewMarkets are confident that rate cuts will benefit stocks and the economy, but one strategist says lower borrowing costs won't stave off a recession. Yet, BCA Research chief asset allocation strategist Garry Evans said this week that lower rates can't avert a looming downturn. "There's things that are breaking down quite rapidly now," Evans said, including recent manufacturing data. Related storiesEvans said labor and manufacturing data, plus a range of global data like weak Japanese exports, are showing signs of a tough economic outlook worldwide. AdvertisementEvans said the Fed will likely cut rates in September, but that it won't prevent a pending recession.

Persons: —, Jerome Powell, Jackson, Stocks, Garry Evans, Evans Organizations: Service, Federal, Business, Research, CNBC, Labor Department, Wednesday, Institute for Supply Management

☆ Don't rush back into the stock market as more pain is coming if the economy keeps slowing, Stifel chief strategist says
▼ + stars: | 2024-08-13 | by ( Kelly Cloonan | ) www.businessinsider.com time to read: +3 min

Stocks are up since last week's sell-off but there's still reason to be cautious, Stifel's Barry Bannister said. He reiterated his expectation for a 10% market correction to push the S&P 500 to 5,000 by October. If the economy keeps slowing and eventually enters a recession, a bear market is imminent as inflation remains sticky, Stifel's chief strategist Barry Bannister said in a Tuesday interview on CNBC. While the Federal Reserve targets a PCE of 2.8%, Bannister expects the central bank to target closer to 3% by the fourth quarter due to persistent housing inflation. Weak GDP, consumption, fixed asset investment and net export data expected in the second half of the year also don't bode well for the economy, Bannister added.

Persons: Stocks, Stifel's Barry Bannister, Bannister, —, Barry Bannister, " Bannister, bode Organizations: Service, CNBC, Federal Reserve

☆ Trump Media tumbles for a 2nd day after the former president returns to X and interviews with Elon Musk
▼ + stars: | 2024-08-13 | by ( Kelly Cloonan | ) www.businessinsider.com time to read: +3 min

Shares of Trump Media dropped almost 4% Tuesday following the former president's interview with Elon Musk. Truth Social's latest earnings show the social media company is still struggling to turn a profit. AdvertisementShares of Donald Trump's media company tumbled for a second day on Tuesday after the former president returned to his firm's top rival after a three-year hiatus. In earnings released last week, Trump Media posted a $16 million loss and a decline in revenue in the most recent quarter. Trump's interview with Musk, streamed on X, lasted over two hours and attracted as many as 1.3 million listeners.

Persons: Elon Musk, —, Donald Trump's, Trump, Twitter —, Musk, Kamala Harris Organizations: Trump Media, Elon, Trump, Service, Truth, Capitol, Twitter, Republican, National Association of Black Journalists Conference Locations: Georgia, Chicago, Palm Beach , Florida

☆ Oil prices surge as US rushes forces to the Middle East ahead of a possible attack by Iran
▼ + stars: | 2024-08-12 | by ( Kelly Cloonan | ) www.businessinsider.com time to read: +2 min

Oil prices spiked on Monday as tensions flared in the Middle East. WTI crude oil and Brent crude were up over 3.6% and 2.86%, respectively. AdvertisementUS and international oil prices are surging as tensions in the Middle East simmer ahead of a potential attack by Iran against Israel. The rise in oil prices comes as Israel prepares for potential attacks from Iran, sources told the Wall Street Journal. Even before the latest production record, the Energy Information Administration announced in March that the US produces more crude oil than any other country.

Persons: Brent, —, Israel, Ismail Haniyeh Organizations: Service, Israel . West Texas, Wall Street Journal, Pentagon, Energy Information Administration Locations: East, Israel, Tehran, Iran, Beirut, OPEC

☆ There's a 40% chance the US economy is already in a recession, according to a new indicator
▼ + stars: | 2024-08-12 | by ( Kelly Cloonan | ) www.businessinsider.com time to read: +1 min

A new indicator says there's a 40% chance the US is in a recession that started as early as March. The measure builds on the Sahm rule, using job vacancy data in addition to unemployment data. The closely watched Sahm rule was triggered earlier this month after a weak July jobs report. Go to newsletter preferences Thanks for signing up! AdvertisementThere's a new recession indicator that's making waves, and it says there's a 40% probability the US is already in a recession.

Persons: —, there's, Pascal Michaillat, Emmanuel Saez, Claudia Sahm — Organizations: Service, Business

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