According to a report released by analysts at Vital Knowledge, they do not believe the rate hike was motivated by any specific news released since Friday’s close, but rather by some downside buying driven largely by oversold conditions and anticipation of monetary support.
The major Wall Street averages fell on Friday just after the August payrolls numbers signaled a continued slowdown in the U.S. labor market, which is quite possibly an assurance that the Federal Reserve will sharply reduce borrowing costs at its next two-day meeting on September 17-18.
For the week, the benchmark S&P 500 index and the 30-stock Dow Jones Industrial Average posted their biggest weekly declines since March of last year, while the tech-heavy NASDAQ Composite index posted its most notable drop since January 2022.
Possible Fed rate cut in the spotlight
Investor bets that the Fed will cut rates by 25 basis points stand at 73% in Monday trading, according to CME Group’s FedWatch tool.
Meanwhile, the probability of a 59 basis point cut stands at 27% after briefly topping 50% in immediate response to the jobs data.
The odds highlight the uncertainty surrounding how the Fed will react to the jobs report.
On Friday, Fed Governor Christopher Waller mentioned that “the time has come” for the Fed to lower rates, although he remained open about the depth and pace of cuts.
Boeing shares rise ahead of market open after reaching tentative agreement with union
Boeing (BA) shares rose Monday in premarket trading after reaching a tentative agreement on a 25% wage hike for its main union, which is likely to avert a damaging strike that is a threat because it could increase pressure on the aircraft maker.
In addition to the wage increase, the proposed four-year agreement includes a commitment to build a new aircraft in the U.S. Pacific Northwest, improved retirement benefits and increased union involvement in aircraft quality.
The leadership of the union, which represents about 30,000 workers, has recommended that its members support the agreement. However, if it is refused and two-thirds vote in favor of the strike, the workers could organize a work stoppage at midnight on Friday.
A labor action would likely increase scrutiny on Boeing’s new CEO, Kelly Ortberg, who is currently on a mission to improve the company’s finances and rebuild its reputation after January’s dangerous mid-flight gate-plug rupture.
On the other hand, shares of cryptocurrency-linked stocks posted positive numbers ahead of the market open. Bitcoin, the most important cryptocurrency in the market increased its share price on Monday, managing to extend its upward momentum for the third day in a row.
Oil prices rise
Oil prices held on to Monday’s gains as traders watched the effect of a possible hurricane on the U.S. Gulf Coast and the market’s response to last week’s nonfarm payrolls report.
The U.S. National Hurricane Center indicated over the weekend that a weather system in the Gulf of Mexico is expected to develop into a hurricane before hitting the northwest U.S. Gulf Coast, an area critical to U.S. refining capacity.
On the other hand, the possibility of lower interest rates also helped crude oil. Theoretically, lower financing costs could stimulate economic activity and boost demand for oil.U.S. stock markets trade higher on the back of a strong weekly sell-off Stocks
According to a report released by analysts at Vital Knowledge, they do not believe the rate hike was motivated by any specific news released since Friday’s close, but rather by some downside buying driven largely by oversold conditions and anticipation of monetary support.
The major Wall Street averages fell on Friday just after the August payrolls numbers signaled a continued slowdown in the U.S. labor market, which is quite possibly an assurance that the Federal Reserve will sharply reduce borrowing costs at its next two-day meeting on September 17-18.
For the week, the benchmark S&P 500 index and the 30-stock Dow Jones Industrial Average posted their biggest weekly declines since March of last year, while the tech-heavy NASDAQ Composite index posted its most notable drop since January 2022.
Possible Fed rate cut in the spotlight
Investor bets that the Fed will cut rates by 25 basis points stand at 73% in Monday trading, according to CME Group’s FedWatch tool.
Meanwhile, the probability of a 59 basis point cut stands at 27% after briefly topping 50% in immediate response to the jobs data.
The odds highlight the uncertainty surrounding how the Fed will react to the jobs report.
On Friday, Fed Governor Christopher Waller mentioned that “the time has come” for the Fed to lower rates, although he remained open about the depth and pace of cuts.
Boeing shares rise ahead of market open after reaching tentative agreement with union
Boeing (BA) shares rose Monday in premarket trading after reaching a tentative agreement on a 25% wage hike for its main union, which is likely to avert a damaging strike that is a threat because it could increase pressure on the aircraft maker.
In addition to the wage increase, the proposed four-year agreement includes a commitment to build a new aircraft in the U.S. Pacific Northwest, improved retirement benefits and increased union involvement in aircraft quality.
The leadership of the union, which represents about 30,000 workers, has recommended that its members support the agreement. However, if it is refused and two-thirds vote in favor of the strike, the workers could organize a work stoppage at midnight on Friday.
A labor action would likely increase scrutiny on Boeing’s new CEO, Kelly Ortberg, who is currently on a mission to improve the company’s finances and rebuild its reputation after January’s dangerous mid-flight gate-plug rupture.
On the other hand, shares of cryptocurrency-linked stocks posted positive numbers ahead of the market open. Bitcoin, the most important cryptocurrency in the market increased its share price on Monday, managing to extend its upward momentum for the third day in a row.
Oil prices rise
Oil prices held on to Monday’s gains as traders watched the effect of a possible hurricane on the U.S. Gulf Coast and the market’s response to last week’s nonfarm payrolls report.
The U.S. National Hurricane Center indicated over the weekend that a weather system in the Gulf of Mexico is expected to develop into a hurricane before hitting the northwest U.S. Gulf Coast, an area critical to U.S. refining capacity.
On the other hand, the possibility of lower interest rates also helped crude oil. Theoretically, lower financing costs could stimulate economic activity and boost demand for oil.Publication date:
2024-09-09 12:55:21 (GMT)
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