US inflation fell short of expectations for the first time, and the pace of interest rate hikes may slow, but still need to be cautious about the impact of falling corporate profits.
$Nasdaq Composite Index (.IXIC.US)$ HP ~ US CPI data is finally back
IT WAS THE FIRST TIME IN MONTHS THAT INFLATION FELL SHORT OF EXPECTATIONS, AND U.S. EQUITIES WERE ALSO STRONG, WITH THE $NASDAQ COMPOSITE INDEX (.IXIC.US) UP 7.35% ON THE NIGHT, THE S&P 500 (.SPX.US) UP 5.54%, AND THE $DOW JONES INDEX (.DJI.US) UP 3.70%.
IT WAS THE FIRST TIME IN MONTHS THAT INFLATION FELL SHORT OF EXPECTATIONS, AND U.S. EQUITIES WERE ALSO STRONG, WITH THE $NASDAQ COMPOSITE INDEX (.IXIC.US) UP 7.35% ON THE NIGHT, THE S&P 500 (.SPX.US) UP 5.54%, AND THE $DOW JONES INDEX (.DJI.US) UP 3.70%.
The market now expects inflation to ease, and the pace of the Fed's rate hike will slow down accordingly, and Powell also said painfully on Thursday night that it could pause slightly when the benchmark interest rate is around 4.5% to see how things are going.
And if the rate was raised by another 50 basis points in December, the rate level would have reached the 4.5% that Powell said. In the fastest and most optimistic scenario, the Fed will pause its pace of rate hikes before the end of this year and then watch the economy.
And if the rate was raised by another 50 basis points in December, the rate level would have reached the 4.5% that Powell said. In the fastest and most optimistic scenario, the Fed will pause its pace of rate hikes before the end of this year and then watch the economy.
However, there is some lag in the transmission of monetary policy to the physical economy, and the economic impact of the massive rate cuts in the preceding months will gradually become apparent in recent months. How much damage will do to the US and global economies remains unclear.
Cutter programs for large enterprises
$Meta Platforms (META.US) $ is confident that everyone already knows, and e-commerce giant $Amazon (AMZN.US) $ has also announced a cost-cutting review that will examine some unprofitable business segments, including the equipment division, voice assistant Alexa, and more, then I believe in the review The way to reduce costs after checking is “cutters”.
Cutter programs for large enterprises
$Meta Platforms (META.US) $ is confident that everyone already knows, and e-commerce giant $Amazon (AMZN.US) $ has also announced a cost-cutting review that will examine some unprofitable business segments, including the equipment division, voice assistant Alexa, and more, then I believe in the review The way to reduce costs after checking is “cutters”.
$Twitter (TWTR.US) $ Is Experiencing Cutbacks After Musk's Acquisition, While Musk's Big Headquarters $Tesla (TSLA.US)$ It is also not optimistic, as reported by industry media Electrek, many Tesla Solar customers have received notifications in recent days that services in their area will be canceled and their orders have been canceled. The affected range is currently in the Greater Los Angeles area, Northern California, Oregon and Florida. Tesla has already laid off some staff in its solar dispatching, planning and design departments, according to reports. (Consultation from FedEx)
As many large companies begin cutting costs, the pressure on small businesses is likely to rise in the unemployment rate in the United States. As the unemployed population rises, total social needs will fall further. Standing in terms of inflation, this is a good thing because falling demand drags the fall in property prices.
But from the perspective of corporate profitability, falling social demand is definitely not a good thing, as this will lead to a decrease in the volume of trade in goods and a decrease in corporate profits. The price-wage spiral that was previously feared could evolve into a commodity unemployment spiral, which is bad for the overall economy.
However, it is said that the US government will intervene to ensure the vitality of the US economy as much as possible. But over the next period of time, I think we should be wary of the risk of a corporate performance downgrade from the Fed's monetary policy, which will directly cause stock market valuation hubs to move downward and affect share prices as well.
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$Hang Seng Index (800000.HK)$
As many large companies begin cutting costs, the pressure on small businesses is likely to rise in the unemployment rate in the United States. As the unemployed population rises, total social needs will fall further. Standing in terms of inflation, this is a good thing because falling demand drags the fall in property prices.
But from the perspective of corporate profitability, falling social demand is definitely not a good thing, as this will lead to a decrease in the volume of trade in goods and a decrease in corporate profits. The price-wage spiral that was previously feared could evolve into a commodity unemployment spiral, which is bad for the overall economy.
However, it is said that the US government will intervene to ensure the vitality of the US economy as much as possible. But over the next period of time, I think we should be wary of the risk of a corporate performance downgrade from the Fed's monetary policy, which will directly cause stock market valuation hubs to move downward and affect share prices as well.
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