Wall Street Today | Fed Is Done Raising Rates and Will Cut Them in 2024, Economists Say
MACRO
Fed Is Done Raising Rates and Will Cut Them in 2024, Economists Say
The Federal Reserve is done raising interest rates and will likely cut them by roughly one percentage point next year, according to chief economists at some of North America’s largest banks.
While the US will probably dodge a recession, economic growth looks set to slow markedly in the coming quarters, pushing up unemployment while reducing inflation, the latest forecast from the American Bankers Association’s Economic Advisory Committee shows.
Fortunes for Mega- and Small-Cap Stocks Poised to Flip, Bank of America Says
With equities in the “recovery” phase of the business cycle, this year’s laggards — including value and small-capitalization stocks — are primed to outperform, upending the growth, large-cap leadership that has dominated 2023’s bull run, according to strategists led by Savita Subramanian.
Historically, such cycle phases have favored financials, industrials, and materials, while utilities, health care, and staples have tended to underperform, BofA said. The firm’s model tracks inputs, including inflation, gross domestic product forecasts, the 10-year Treasury yield, and various manufacturing data.
SECTORS
Oil Holds at Yearly Highs as Technical Levels Give Traders Pause
West Texas Intermediate edged lower to settle near $87 a barrel after a 2.3% advance last week. Oil has surged by almost $20 a barrel since mid-June on supply curbs from Saudi Arabia and Russia, which have now been extended through the end of the year.
Traders are bracing for a potential pullback as technical gauges, including the relative strength index, show futures remain near overbought territory after a renewed surge over the past two and a half weeks.
Arm’s IPO Orders Are Already Oversubscribed by 10 Times
Arm Holdings Ltd.’s initial public offering is already oversubscribed by 10 times, and bankers plan to stop taking orders by Tuesday afternoon, according to people familiar with the matter.
Instacart targets up to $9.3 bln valuation for much-awaited US IPO
Instacart and its backers set the stage for an initial public offering that may value the grocery-delivery business at as much as $9.3 billion, less than a quarter of what it was worth at the height of the Covid-19 pandemic. The company is seeking to raise as much as $616 million.
COMPANIES
Morgan Stanley Sees Dojo Boosting Tesla’s Value by $500 Billion
$Tesla(TSLA.US$'s Dojo supercomputer may add as much as $500 billion to the company’s market value through faster adoption of robotaxis and network services, according to Morgan Stanley.
J.M. Smucker to Buy Twinkies Maker Hostess for $5.6 Billion
Oracle Revenue Misses Estimates as Tough Economy Hurts Cloud Spending
$Oracle(ORCL.US$ narrowly missed market expectations for first-quarter revenue on Monday, as companies pared back spending on cloud services due to an uncertain economic outlook.
Disney and Charter Reach Agreement to End ESPN, ABC Blackout
$Charter Communications(CHTR.US$ will offer $Disney(DIS.US$ flagship streaming service at no additional cost to cable-TV subscribers as part of a landmark deal the two companies announced Monday.
RTX to Take $3 Billion Charge on Pratt & Whitney Engine Problem, Shares Tumble 8%
$RTX Corp(RTX.US$ slumped after cutting its full-year sales outlook. The company dramatically expanded the scope of required engine checks at its Pratt & Whitney unit, which will affect nearly its entire fleet of turbines powering Airbus SE’s latest A320 and ground hundreds of the single-aisle jets for months.
Source: Bloomberg, Dow Jones, CNBC
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sociable Sheep_7248 : Says the failing banks
Dramericanjesus : If you don't call it a recession, it can't be one. Yaay!
70900432 : I think the FED’s only power to lower inflation is to limit the money supply by raising interest rates that will result on cooling down the economy and unemployment. How about surplus of common goods such as energy, food and housing to lower inflation, who is responsible for that?
lightfoot : Awesome news. Now the consumer will decide . Low consumption, high inventories will lower prices. Pass it On!. Boycott is good. Remember products expire, meaning these items. don't sell are charged off the inventory and shrinkage rising to force lower prices. Yes, the system will work. I see people taking items to the registers and leaving them for the ridiculous prices they are.
lightfoot : If sales drop and inventories rise look for great deals. I witnessed a consumer buy a 3000lb floor jack which had a suggested retail price of 249$ for 30$.
free bird : Disagree. The Fed needs to implement one more rate increase this year. There's just too much money available. Until it dries up, inflation won't recede.
MonkeyGee : it's not over until it's over