Wall Street edges higher as markets anticipate Fed speakers amidst rate-cut optimism.
Wall Street Awaits Clarity on Fed’s Rate Cut Decision
November 6, 2023 – 3:14 PM UTC
(Reuters) – In an exciting start to the week, Wall Street’s main indexes are showing a slight upward trend as investors eagerly anticipate commentary from policymakers. This much-awaited insight is expected to shed light on whether the Federal Reserve will cut rates next year.
Shares of Tesla (TSLA.O) are soaring, up 1.1% after a source revealed that the electric automaker plans to build a 25,000-euro ($26,838) car near Berlin.
Excitingly, seven of the 11 major S&P 500 sectors are experiencing gains, with information technology (.SPLRCT) and consumer discretionary (.SPLRCD) leading the charge.
Last week, U.S. equities had their best performance in about a year, boosted by falling Treasury yields. This was fueled by a weaker-than-expected monthly payrolls report, which raised hopes of a rate cut by the Fed next year.
Traders are currently betting that the Fed will maintain interest rates in December, with a 90% certainty. Additionally, there is an 80% chance that the first policy easing will occur as early as June, according to the CME Group’s FedWatch tool.
This week, market participants will closely monitor the views of various Fed policymakers, including Chair Jerome Powell, who are scheduled to speak in the coming days. Their insights will put these expectations to the test.
Other notable speakers include:
- Federal Reserve Board Governor Lisa Cook
- New York Fed President John Williams
- Dallas Fed President Lorie Logan
The yield on the benchmark ten-year Treasury note, which reached five-week lows on Friday, has slightly increased to 4.63% on Monday.
“The one thing that needs to happen for the rally to continue to gain momentum is for the 10-year yields to stabilize,” said Jamie Cox, managing partner at Harris Financial Group.
“Rates are going to stabilize lower because it’s pretty clear that the Fed has no intentions of raising rates in December and then we’re getting closer to the rate cut dot plot in 2024.”
This week’s economic-data calendar is relatively light, with weekly jobless claims numbers due on Thursday and the University of Michigan’s consumer sentiment report on Friday.
Notable companies reporting earnings this week include Walt Disney (DIS.N), Instacart (CART.O), and Biogen (BIIB.O).
According to LSEG data, out of the 403 companies in the S&P 500 that have reported profits in the third quarter, an impressive 81.6% have surpassed analyst estimates.
As of 9:47 a.m. ET, the Dow Jones Industrial Average (.DJI) is up 21.60 points, or 0.06%, at 34,082.92, the S&P 500 (.SPX) is up 5.99 points, or 0.14%, at 4,364.33, and the Nasdaq Composite (.IXIC) is up 52.21 points, or 0.39%, at 13,530.50.
However, Dish Network(DISH.O) has experienced a 19.9% drop after missing third-quarter revenue estimates and announcing the departure of CEO Erik Carlson.
Bumble(BMBL.O) has also slipped 7.6% as founder Whitney Wolfe Herd steps down as its chief executive.
On the NYSE, declining issues outnumbered advancers with a ratio of 2.01-to-1, while on the Nasdaq, the ratio was 1.24-to-1.
The S&P index has recorded eight new 52-week highs and no new lows, while the Nasdaq has seen 17 new highs and 32 new lows.
Reporting by Amruta Khandekar and Shristi Achar A; Editing by Maju Samuel
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What information are investors eagerly awaiting from policymakers regarding the Federal Reserve’s rate cut decision?
Wall Street Awaits Clarity on Fed’s Rate Cut Decision
November 6, 2023 – 3:14 PM UTC
In an exciting start to the week, Wall Street’s main indexes are showing a slight upward trend as investors eagerly anticipate commentary from policymakers. This much-awaited insight is expected to shed light on whether the Federal Reserve will cut rates next year.
Shares of Tesla (TSLA.O) are soaring, up 1.1% after a source revealed that the electric automaker plans to build a 25,000-euro ($26,838) car near Berlin.
Excitingly, seven of the 11 major S&P 500 sectors are experiencing gains, with information technology (.SPLRCT) and consumer discretionary (.SPLRCD) leading the charge.
Last week, U.S. equities had their best performance in about a year, boosted by falling Treasury yields. This was fueled by a weaker-than-expected monthly payrolls report, which raised hopes of a rate cut by the Fed next year.
Traders are currently betting that the Fed will maintain interest rates in December, with a 90% certainty. Additionally, there is an 80% chance that the first policy easing will occur as early as June, according to the CME Group’s FedWatch tool.
This week, market participants will closely monitor the views of various Fed policymakers, including Chair Jerome Powell, who are scheduled to speak in the coming days. Their insights will put these expectations to the test.
Other notable speakers include:
-Federal Reserve Board Governor Lisa Cook
-New York Fed President John Williams
-Dallas Fed President Lorie Logan
The yield on the benchmark ten-year Treasury note, which reached five-week lows on Friday, has slightly increased to 4.63% on Monday.
“The one thing that needs to happen for the rally to continue to gain momentum is for the 10-year yields to stabilize,” said Jamie Cox, managing partner at Harris Financial Group.
“Rates are going to stabilize lower because it’s pretty clear that the Fed has no intentions of raising rates in December and then we’re getting closer to the rate cut dot plot in 2024.”
This week’s economic-data calendar is relatively light, with weekly jobless claims numbers due on Thursday and the University of Michigan’s consumer sentiment report on Friday.
Notable companies reporting earnings this week include Walt Disney (DIS.N), Instacart (CART.O), and Biogen (BIIB.O
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