Last Week’s Summary
- S&P 500 Index rose 4.06%
- International Equities rose 1.24%
- Emerging Markets rose 0.80%
- U.S. 10-Year Treasury Yield fell to 3.65%
- Initial Jobless Claims rose to 230k
- CPI fell to 2.5%; Core stayed at 3.2%
- PPI fell to 1.7%; Core stayed at 2.4%
- U. of Mich. Sentiment rose to 69
What to Watch for This Week
- M, 9/16/24 Empire Manufacturing
- T, 9/17/24 Industrial Production
- W, 9/18/24 FOMC Rate Decision, Housing Starts, MBA Mortgage Application
- Th, 9/19/24 Initial Jobless Claims, Leading Index, Existing Home Sales
Weekly Market Recap
Wall Street traders have rekindled hopes for a potential half-point rate cut by the Federal Reserve this month, propelling stocks to their best week of 2024. Investors shifted focus toward companies that stand to gain the most from policy easing, mainly the economically sensitive Russell 2000, which climbed 4.4% this week.
The S&P 500 climbed 4.0%, while its equal-weighted counterpart advanced by 2.7%. The Dow Jones Industrial Average rose by 2.6%, and the Nasdaq 100 added 5.9%. Meanwhile, the “Magnificent Seven” mega-cap stocks edged up by 7.1%.
Earlier in the year, the S&P 500 hit record highs, raising concerns among investors that the rally was overly concentrated in a small group of large tech companies. Now, broader segments of the market are gaining momentum as expectations grow that the start of a Fed rate-cutting cycle will further boost Corporate America.
Treasury Yields on Two-Year notes fell five basis points to 3.59%. The probability of a 50-basis-point rate cut surged to 40% on Friday, up from just 4% earlier in the week.
August’s U.S. Producer Price Index showed a slight uptick after the previous month’s figures were revised downward, and categories tied to the Fed’s preferred inflation gauge remained subdued.
In other economic data, jobless claims increased, while the Core Consumer Price Index (excluding food and energy) rose 0.3% from July, the highest in four months, with a 3.2% year-over-year increase, according to the Bureau of Labor Statistics. All eyes eagerly await the Fed’s Rate decision this week.
90-Second Breakdown:
Redwood Senior Analyst Michael C. Sasaki, CFA® discusses recent market performance and explains this week’s chart.
