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ET, the yield on the 10-year Treasury was up by less than one basis point at 4.2563%. The 2-year Treasury yield was last at 4.4307% after falling by over one basis point. U.S. Treasury yields were little changed on Friday as investors awaited the release of key inflation data ahead of the Federal Reserve's upcoming monetary policy meeting next week. Those are some of the last key economic data releases before the Fed meets next week to discuss monetary policy. The inflation figures come after economic data throughout the week have given mixed signals about the state of the economy.
Persons: Dow Jones Organizations: Treasury, Federal, PCE, Fed, U.S, PMI
Oil prices were up slightly on Friday on stronger-than-expected U.S. economic data that raised investor expectations for increasing crude oil demand from the world's largest energy consumer. But concerns about soft economic conditions in Asia's biggest economies, China and Japan, capped gains. At the same time, inflation pressures eased, which kept intact expectations that the Federal Reserve would move forward with a September interest rate cut. Lower interest rates tend to boost economic activity, which can spur oil demand. Still, continued signs of trouble in parts of Asia limited oil price gains.
Organizations: Brent, . West Texas, Commerce Department, Reuters, Federal Reserve Locations: Fort Stockton , Texas, China, Japan, U.S, Asia
Dexcom — Shares plummeted more than 40% after the medical device maker missed expectations for second-quarter revenue and offered weak full-year guidance for the measure. That exceeded analysts' expectations for earnings of $3.48 per share on revenue of $808 million, per LSEG. Norfolk Southern — Shares of the railroad operator gained 10% after a second-quarter earnings beat. Texas Roadhouse — The restaurant chain climbed 4.4% after second-quarter earnings topped expectations. Texas Roadhouse earned $1.79 per share, above the $1.64 per share estimate from analysts surveyed by LSEG.
Persons: Dexcom, Coursera, Newell Brands, Newell, Boston Beer, LSEG, Mohawk, Bristol Myers Squibb, Morgan Stanley, FactSet, amortization, Bitcoin, Alexander, Baldwin —, Alexander & Baldwin, Piper Sandler, Guggenheim, Sweetgreen —, Oppenheimer, Stifel, Yun Li, Pia Singh, Sean Conlon, Jesse Pound, Hakyung Kim, Lisa Kailai Han Organizations: LSEG, Newell, Yankee, Wall, Boston Beer, Boston, Mohawk Industries, Bristol Myers Squibb, Bristol, Revenue, Norfolk Southern, Norfolk, Charter Communications, Southwest Airlines, Deutsche Bank, Southwest, Redburn, FactSet, FTAI Aviation, Texas, Texas Roadhouse, LSEG . Revenue, Colgate, Palmolive Locations: Norfolk
Separate data on spending shows that American shoppers are still shopping. That measure strengthened in the second quarter, rising to a 2.9% rate compared to 2.6% seen earlier this year. Generally, one risk that comes with an economy that’s expanding robustly is that price pressures can either get stuck or heat up. Businesses are still spending, but less on thisBusinesses invested much more in the second quarter than in the first three months of the year. The measure for that — known as “nonresidential fixed investment” — rose to a 5.2% rate in the second quarter, up from 4.4% in the first quarter.
Persons: That’s, pare, , Jamie Cox, ” Scott Helfstein, ” Oren Klachkin Organizations: Washington CNN, Gross, Commerce Department, Federal Reserve, PCE, Harris Financial Group, , Nationwide
Revenue in the second quarter missed analysts' expectations, coming in at $1 billion versus consensus estimates of $1.04 billion, per LSEG. Boston Beer Company – The maker of Twisted Tea and Samuel Adams slid 5% after second quarter results missed the Street's estimates. The company reported adjusted earnings of $3 per share, excluding items, on revenue of $2.8 billion in the second quarter. Juniper posted adjusted earnings of 31 cents per share and revenue of $1.19 billion in the second quarter. That came up short against analysts' estimates of 44 cents per share in earnings and $1.25 billion in revenue, per LSEG.
Persons: Samuel Adams, Boston Beer, Coursera, Juniper, , Darla Mercado Organizations: Revenue, Boston Beer Company, Boston, Mohawk Industries, FactSet, Juniper Networks
pic.twitter.com/0licQGfphn — Mustafa Suleyman (@mustafasuleyman) October 20, 2023Expectations for the AI boom to generate serious money are absurdly high, then, which helps explain why the hype train for the technology is still running at full tilt. AdvertisementThat was probably hard for investors to hear given AI has pushed Google to spend more. Similar questions around the gap between returns and hype have shown themselves this week in startup land, too. Toronto-based AI startup Cohere, founded by ex-Googlers in 2019, announced a fresh funding round of $500 million on Monday, putting its valuation at about $5.5 billion. Last year, veteran venture capitalist Vinod Khosla suggested most startups were overvalued and that most investments in AI "will lose money."
Persons: , Mustafa Suleyman, — Mustafa Suleyman, Sundar Pichai, Philipp Schindler, Katherine Tangalakis, Lippert, Pichai, Cohere, It's, Harvey —, Winston Weinberg, Gabriel Pereyra —, Harvey, Vinod Khosla Organizations: Service, Business, Google, Microsoft, BI, Google Ventures Locations: California, Toronto, Cohere
GDP: The US economy is pulling off something historic
  + stars: | 2024-07-25 | by ( Bryan Mena | ) edition.cnn.com   time to read: +1 min
Washington CNN —The US economy is on the verge of an extremely rare achievement. Businesses are continuing to invest and a key gauge of consumer demand has been robust this year. As the economy continued to expand from April through June, inflation resumed a downward trend, the latest GDP report showed, and seems to be on track to slowing further toward the Federal Reserve’s 2% target. Wall Street traders are convinced that the Fed will roll out the first rate cut in September, and key Fed officials have given subtle signals that they’ve become more comfortable about eventually slashing rates. America’s economy is about to stick what’s called a “soft landing,” which is when inflation returns to the Fed’s target without a recession — a feat that’s only happened once, during the 1990s, according to some economists.
Organizations: Washington CNN, Commerce Department, Federal, Wall
US real GDP increased at an annualized rate of 2.8% in the second quarter, way above the 2.0% forecast. download the app Email address Sign up By clicking “Sign Up”, you accept our Terms of Service and Privacy Policy . AdvertisementA new Bureau of Economic Analysis report said the advance estimate for US GDP growth in the second quarter was 2.8% at an annualized rate. That's way more than the 2.0% forecast noted on Investing.com and the 1.4% growth in the first quarter. This story is available exclusively to Business Insider subscribers.
Persons: Organizations: Service, Business
Real gross domestic product , a measure of all the goods and services produced during the April-through-June period, increased at a 2.8% annualized pace adjusted for seasonality and inflation. Economists surveyed by Dow Jones had been looking for growth of 2.1% following a 1.4% increase in the first quarter. Economic activity in the U.S. was considerably stronger than expected during the second quarter, according to an initial estimate Thursday from the Commerce Department. The so-called chain-weighted price index, which takes into account changes in consumer behavior, increased 2.3% for the quarter, below the 2.6% estimate. There also is pressure in the housing market: Sales are declining while home prices continue to climb, putting pressure on first-time homebuyers.
Persons: Dow Jones Organizations: Commerce Department, Stock, Federal Reserve, Fed, Philadelphia Federal Locations: U.S
According to the New York Federal Reserve, which uses the 10-year/three-month curve, a recession should happen about 12 months later. The inversion is not aloneMaking the situation even more complicated is that the yield curve isn't the only indicator showing reason for caution about how long the post-Covid recovery can last. But the rate dynamics have helped companies escape what usually happens in an inverted curve. With an inverted curve hitting their net interest margins, banks may opt to lend less, causing a pullback in consumer spending that can lead to recession. This could provide something of a self-fulfilling prophecy for the yield curve.
Persons: Alex Kent, hasn't, , there's, it's, Mark Zandi, It's, Joseph LaVorgna, SMBC, Quincy Krosby, We've, Jim Paulsen, Paulsen, That's Organizations: New York Stock Exchange, Bloomberg, Getty, Moody's, New York Federal Reserve, SMBC Nikko Securities, Gross, National Bureau of Economic Research, Commerce Department, LPL, Federal Reserve, Fed Locations: New York, SMBC Nikko, Wells Fargo
Stock were mixed early Tuesday as investors awaited earnings from big companies. Markets are getting ready to pick through results from Tesla and Alphabet after the closing bell. download the app Email address Sign up By clicking “Sign Up”, you accept our Terms of Service and Privacy Policy . AdvertisementUS stock moves were muted on Tuesday, with investors getting ready to go over earnings results from Tesla and Google parent Alphabet after the closing bell. Tesla and Alphabet are the first of the Magnificent Seven tech cohort to post second-quarter results.
Persons: , Russell, Bill Adams, Adams Organizations: Service, Tesla, Google, Nasdaq, Federal
Existing home sales fell in June to nearly to their slowest pace since 2010. The decline comes as home prices notched a record high in the same month. Sign up to get the inside scoop on today’s biggest stories in markets, tech, and business — delivered daily. download the app Email address Sign up By clicking “Sign Up”, you accept our Terms of Service and Privacy Policy . AdvertisementThe pace of existing home sales fell close to a record low in June as record-high prices and persistently high mortgage rates turned buyers away.
Persons: Organizations: Service, National Association of Realtors, Business
"We're seeing a slow shift from a seller's market to a buyer's market," said Lawrence Yun, chief economist for the Realtors. These inventory levels are the highest supply since May 2020, boosted by homes sitting on the market longer. Supply of homes for sale is weakest on the lower end, but is seeing a new surge now. While the sales price nationally is high, new listing prices are lower. Either home sales rise, or, if the prices do not rise, the prices would buckle down," Yun added.
Persons: Lawrence Yun, Danielle Hale, Yun Organizations: National Association of Realtors, Realtors, Realtor.com, Investors Locations: Patchogue, N.Y, Patchogue , New York
UBS said a major rotation from cash and bonds into stocks could happen later this year. UBS' Jason Draho reiterated his bull case for the S&P 500 to rise 17% into year-end. AdvertisementThe cash-to-stocks trade is the more durable rotation investors should be watching, UBS said. "We still recommend that investors position for lower rates, seek quality growth stocks, and seize the AI opportunity," Draho said. There will be a rotation trade in that scenario, but from cash and bonds into stocks," Draho said.
Persons: Jason Draho, , there's, Draho, it's Organizations: UBS, Service, Federal Reserve
The Buffett Indicator is indicating US stocks might be overvalued. AdvertisementWarren Buffett's favorite stock market valuation indicator just hit a record high, signaling that stocks might be highly overvalued. The stock market experienced a painful year-long bear market shortly after the Buffett Indicator peaked in November 2021. But despite the Buffett Indicator's flaws, it is flashing a big warning signal for stock market investors at current levels, according to Bloomstran. Advertisement"I think it's screaming the cap-weighted stock market, the Wilshire 5000 [and] the S&P 500, is incredibly dangerous today.
Persons: Warren Buffett, Buffett, , Warren, Riley, Paul Dietrich, Chris Bloomstran, Semper Augustus, Bloomstran Organizations: Service, Buffett
But in general, this is the kind of development we've hoped to see ever since Starbucks' massive earnings miss April 30. We'll take the nearly 7% pop in shares Friday and hope it's only the beginning of recovery for the beaten-up stock. Fed's fave inflation measure : The personal spending and income report will be the most closely watched economic report next week. Earnings : As the second-quarter earnings season picks up pace, we'll hear from five Club holdings next week including Google parent Alphabet . Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust's portfolio.
Persons: Russell, Donald Trump, — Trump, Jim Cramer, Trump, Donald Trump's, Taiwan's TSMC, Joe Biden's, Biden, Biden's, he's, Elliott, we've, We'll, it's, we'll, Sartorius, Ford, Jim Farley, We're, Honeywell management's, , Zions, BOK, Brown, BRO, Lockheed Martin, Philip Morris, Clark, Lamb, Edwards Lifesciences, DOV, Dr Pepper, CARR, Baker Hughes, Booz Allen Hamilton, Jim Cramer's, Jim Organizations: Federal Reserve, Nasdaq, Dow, Republican National Convention, GOP, Bloomberg Businessweek, Trump, Elliott Management, Starbucks, Street Journal, Technology, General Motors, Honeywell, Dover, Products Company, Verizon, Truist, SAP, Semiconductors, Crown Holdings, Cadence Design Systems, Medpace Holdings, AGNC Investment, Logitech International S.A, KKR Real Estate Finance Trust, Berkley Corp, Spotify Technology S.A, United Parcel Service, GE Aerospace, GE, Cola Company, Lockheed, Comcast, Polaris Industries, Philip Morris International, Company, HCA Healthcare, Moody's Corporation, Enphase Energy, Texas Instruments Incorporated, Chubb Corporation, Seagate Technology plc, Maine, Packaging Corporation of America, Weatherford International plc, Canadian National Railway Company, FTAI Aviation Ltd, Mattel, Vertiv Holdings Co, Lamb Weston Holdings, NextEra Energy, Tenet Healthcare, Fisher, GE Vernova, Boston Scientific Corporation, General Dynamics, Lennox International, Software Technologies, CME Group, Fortive Corporation, Co, Roper Technologies, Teck Resources Limited, Blackstone Mortgage Trust, Economico Mexicano S.A, Dominion Freight, Otis Worldwide Corporation, OTIS, Ford Motor Company, Grill, Business Machines, IBM, Viking Therapeutics, Las Vegas Sands Corp, Newmont, Whirlpool, Globe, WM, O'Reilly Automotive, Annaly Capital Management, Honeywell International, American Airlines Group, Hasbro, Southwest Airlines Co, New York Community Bancorp, RTX Corporation, AstraZeneca, Carrier Global Corporation, Integer Holdings Corporation, Valero Energy, Texas, Juniper Networks, Boston Beer Company, Physicians Realty Trust, Allison Transmission Holdings, Corp, Columbia Banking, Digital Realty Trust, Edison International, Myers Squibb, Charter Communications, 3M Company, Booz, Centene Corporation, AON, Barnes, Colgate, Palmolive, Jim Cramer's Charitable, CNBC, U.S Locations: U.S, Taiwan, FactSet, China, Dover, Cleveland, Alexandria, ZION, W.R, Freeport, Kimberly, Cal, Teck, Las, ORLY, New, Banc, Bristol, Milwaukee , Wisconsin
The consumer will be in focus next week as investors head into the thick of earnings season and await some major macroeconomic reports. So far, just 14% of S & P 500 companies have reported earnings results. As one strategist noted, Wall Street is about to get insight into the economy from more than half the broad market index. The thick of earnings Earnings season is off to a strong start. Credit card company Visa will be reporting next week after American Express' results this week suggested inflationary pressures have reached the higher-end consumer.
Persons: Russell, We're, Terry Sandven, Sherwin, Williams, Charles Ashley, Read, Ashley, We've, It's, Lockheed Martin, Kimberly, Clark, General, Philip Morris, Lamb Weston, Northrop, Rowe Price Organizations: Federal, Nvidia, U.S, Bank Asset Management, Nasdaq, Dow Jones, Whirlpool, Catalyst Funds, Visa, American Express, Google, Commerce, FactSet, Fed, Chicago, Verizon, Richmond Fed, Enphase Energy, Capital, Texas, Williams, Comcast, General Motors, United Parcel Service, Philip Morris International, GE Aerospace, PMI, O'Reilly, Grill, Business Machines, Vegas Sands, Ford Motor, Technology, NextEra Energy, GE, . Kansas City Fed Manufacturing, American Airlines, CBRE, Valero Energy, Hasbro, Tractor Supply, Northrop Grumman, Southwest Airlines, Honeywell International, Norfolk Southern, Rowe Price Group, Myers Squibb, Colgate, Palmolive Locations: , Freeport, McMoRan, Vegas, . Kansas, Michigan, Bristol
At the end of July, the Federal Open Market Committee will announce its next decision on interest rates. Some economists have recently been pointing to similar concerns with the Fed keeping interest rates high. As Sahm pointed out, it would take time for reduced interest rates to "flow through to the economy." "You want to begin a process of taking the pressure off of the economy," Sahm said. AdvertisementZandi said interest rates on credit cards and Buy Now, Pay Later rates could come down, along with a decline in auto lending rates and mortgage rates.
Persons: , Mark Zandi, Jerome Powell, Powell, Claudia Sahm, it's, Sahm, Sen, Elizabeth Warren, Brian Rose, Rose, Zandi, Austan Goolsbee, Goolsbee Organizations: Service, Moody's, Business, Federal, CME FedWatch, Fed, Banking, Housing, Urban Affairs, Sahm Consulting, Federal Reserve, Democratic, UBS, Chicago Federal, Wall Street Journal
With the S & P 500 surging more than 18% in 2024, it might be time for investors to make a few defensive moves in their portfolios. But that surge is spurring some financial advisors to reassess their clients' exposure to large-cap tech and turn toward currently unloved asset categories that could be poised to rise. "It might take a little longer to manifest but we think [health care] is an interesting combination of offense and defense, and it provides meaningful cash flows for investors," Saccocia said. Checking in on risk and cash Investors reviewing their 2024 gains should also reassess their risk profile and consider whether their asset allocation reflects their long-term goals. Tom Balcom, CFP and founder of 1650 Wealth Management in Lighthouse Point, Florida, has used custom market-linked notes to hedge clients' exposure to the market.
Persons: Nvidia —, Shon Anderson, Russell, Jerome Powell's, Shannon Saccocia, Neuberger Berman, Saccocia, Colin Gerrety, Gerrety, Tom Balcom, Balcom, Morningstar Organizations: Nvidia, Anderson Financial, Federal, Big Tech, Investors, JPMorgan Chase, UnitedHealth, Wealth Services Locations: Dayton , Ohio, REITs, North Bethesda , Maryland, Lighthouse Point , Florida
He favors small-cap, mid-cap, and quality stocks over the Big Tech mega-caps leading the market rally for three reasons. One is that the earnings winning streak that Magnificent Seven stocks have enjoyed is simply difficult to keep going. In the first quarter of this year, Magnificent Seven earnings grew by 50% annualized year-over-year, according to Ned Davis Research. Wall Street estimates Magnificent Seven earnings will grow by 28% year-over-year in Q2. When it comes to innovating and adapting, small and mid-cap companies' size gives them a relative advantage.
Persons: , Larry Kochard, Ned Davis, Kochard, reinvesting, It's, it's Organizations: Service, Big Tech, Capital Management, Business, Ned Davis Research, Wall, The, Apple, Google, Microsoft, Nvidia, European Union, Quality
Instead, the single best economic news of the past decade is but a murmur of chit-chat, barely audible against a clamor of politicos shouting about President Joe Biden’s age. Bidenomics worked and no one caresFor the past three years, President Biden’s biggest political liabilities have been painfully obvious: his age and inflation. Still, Thursday should have been a day for the White House to spike the football and double down on a message that has, historically, fallen flat — that Bidenomics is working. Rather than doing a victory lap, Biden on Thursday was preparing for a high-stakes news conference in front of a ravenous White House press corps that focused their questions almost entirely on his fitness to lead. The White House can finally cross out “inflation” on its list of presidential liabilities.
Persons: CNN Business ’, New York CNN —, it’s, Aaron Sojourner, Jay Powell, Joe Biden’s, Bidenomics, Biden’s, doesn’t, that’s, whoever’s, aren’t, Alicia Wallace, Biden, Donald Trump, it’ll, sipping Champagne Organizations: CNN Business, New York CNN, econ, Biden, Consumers, Labor Department, White, House, Democratic Locations: New York, America
Kelly Evans: The cuts are coming
  + stars: | 2024-07-11 | by ( Kelly Evans | ) www.cnbc.com   time to read: +2 min
Seeing the June CPI print with a negative sign. You can be pretty sure now that Fed rate cuts are coming. Core CPI for the past three months annualized is now running just 1.1%. In fact, core goods prices have dropped 12 out of the past 13 months in the CPI. We could actually be at a pretty nice economic inflection point right now--but only if the labor market doesn't keep slowing.
Persons: we've, we're, Julia Coronado, J.P, Morgan, Powell, Goldman Sachs, Gary Cohn, Kelly Twitter, @KellyCNBC, @realkellyevans Organizations: CPI, Treasury, Trump, CNBC, Nasdaq
But increasingly, there are signs that the job market is losing some steam. Whether it's hard data like the unemployment rate or sentiment-based surveys of businesses, it's clear that the labor market has cooled off. It's clear that the Federal Reserve should be the force to slow down the sliding job market. The job market is at an inflection pointThe emergence of the US from the worst of the pandemic shutdowns in early 2020 helped usher in a historic boom for the labor market. If 3% growth could not keep unemployment from climbing in 2023, why would the unemployment rate remain stable in 2024 if growth comes in substantially lower?
Persons: Beveridge, Taylor, Jerome Powell, Powell Organizations: Federal, Fed, Atlanta, Federal Reserve
Investors enjoying juicy yields on their cash should start preparing to shift their strategy, according to Goldman Sachs. People piled into cash instruments like Treasury bills and money market funds as the short end of the yield curve rose alongside Federal Reserve interest rate increases starting in early 2022. Now some $6.15 trillion is sitting in money market funds, as of July 2, according to the Investment Company Institute . There's a "real probability" that could start in September, said Lindsay Rosner, head of multi-sector investing at Goldman Sachs Asset and Wealth Management. While the average spread is around 800 basis points over Treasurys, the bonds are either trading around 300 basis points — too tight for junk bond ratings — or 1,000 basis points or more.
Persons: Goldman Sachs, Lindsay Rosner, , Rosner, " Rosner Organizations: Federal, Investment Company Institute, Goldman, Wealth Management, Fed, riskier Locations: Goldman Sachs, Treasurys
Read previewThere is perhaps no better example of the hedge fund industry's maturation than Brevan Howard. The $35 billion firm has changed considerably since 60-year-old Alan Howard stepped back from running its day-to-day operations in 2019. Now, Howard — the firm's majority owner — no longer manages money at Brevan. The firm's two biggest funds — the long-running, $11.9 billion Master Fund and the younger, $12.2 billion Alpha Fund — each manage more money now than the entire firm did five years ago. Advertisement"The real challenge is keeping the trading talent," said Nagi Kawkabani, a former Brevan Howard co-CEO told Institutional Investor in 2019.
Persons: , Brevan Howard, Alan Howard, Howard, Howard —, Rishi Shah, Fash, Minal Bathwal, Trifon Natsis, Aron Landry, James Vernon, Jean, Philippe Blochet, Chris Rokos —, Natsis, Landry, Brevan, Nagi Kawkabani, Shah, Shaw, He's, he's Organizations: Service, Business, Fund, Alpha, Credit Suisse, Alpha Fund, Citadel, Bloomberg, Investor, United Arab, Winton Group Locations: Brevan, Ville, Natsis, Abu Dhabi, United Arab Emirates
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