Share to Twitter Share to Linkedin As inflation remains ridiculously high, Atlanta Federal Reserve Chief Raphael Bostic remains economically optimistic. He said there is a “ really good chance ” the U.S. job market won’t take a severe hit as a result of the Fed's continued hawkish stance on raising rates. Out of the 12 Federal Regional banks, Bostic is the only Black person on the Federal Reserve’s policy setting committee, meaning there’s only one African American with a direct say on U.S. monetary policy. The Breakdown You Need To Know: CultureBanx noted how U.S. central bankers are still striving for a goal of 2% inflation, though the country is a far cry from that number with inflation currently hovering at 8.3% . Bostic had previously stated that past periods of ultra-low unemployment have been followed by recessions. However, he told CBS’s Face The Nation that “there is a really good chance that if we have job losses, it will be smaller than … [Read more...] about Atlanta’s Fed President Is High On Job Growth Amid Slow Economy
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Asian markets rallied Tuesday and the dollar eased after weak US factory data sparked optimism that a series of big interest rate hikes were taking their toll, allowing the Federal Reserve to ease its foot off the pedal. Oil also continued to rise on expectations OPEC and other major producers will slash output this week, having become spooked by a plunge in the commodity on recession fears. All three main indexes in New York enjoyed a bumper start to the quarter after data showed US manufacturing growth slowed more than expected in September to its weakest in more than two years. SPI Asset Management’s Stephen Innes said: “The positive aspect in the data is prices paid dropped to 51.7, the lowest print since June 2020, triggering a mini-risk revival in stocks and a sell-off on the US dollar as US yields continued to slide. “In this hawkishly priced risk environment, bad data is considered good news, as it raises the possibility of a doveish pivot by the Federal Reserve.” But … [Read more...] about Markets rally, dollar dips as US data tempers rate fears
Philippine shares rallied on Tuesday amid gains across the region and Wall Street on bets the influential US Federal Reserve would slow aggressive interest rate hikes to avoid a recession. The Philippine Stock Exchange Index jumped 3.54 percent, or 204.57 points, to 5,987.72, while the broader All Shares Index added 3.09 percent, or 96.35 points, to 3,210.48. The benchmark measure, which remains in bear market territory, pushed higher after briefly slipping below the 5,700 level on Monday. US stocks advanced overnight after disappointing manufacturing data raised hopes the Fed would shift from its tightening cycle to support economic growth. The Bangko Sentral ng Pilipinas separately warned speculators against taking advantage of volatile currency markets as the Philippine peso traded near its low of P59 against the greenback. All local stock exchange subsectors rose on Tuesday, led by holding firms and property, up 4.73 percent and 4.19 percent, respectively. Mining and oil also … [Read more...] about Shares buoyed by bets US Fed may end hawkish cycle
Share to Twitter Share to Linkedin Key Takeaways The US went through stagflation in the 1970s, it’s the only time in our history. While we’re not officially in a recession, there are growing concerns about what the continued rate hikes will do to the economy. A recession and stagflation are bad news, but stagflation is worse because it means we’re experiencing high inflation and high unemployment rates. We have all heard a lot about the possibility of a recession lately, but another lesser-known possibility is stagflation, though it’s rare for high inflation to be matched with high unemployment. Fortunately, the US economy only experienced stagflation once in the 1970s when the economy suffered under some extremely unique conditions. While we’re technically not in a recession right now, it certainly feels like we’re not far off. According to economists, the resilient labor market helped us avoid an official recession. There are rising … [Read more...] about Stagflation vs. Recession: It’s The Economic Equivalent Of A Perfect Game vs. A No Hitter
- A + A BENGALURU (Oct 4): Wall Street futures jumped on Tuesday (Oct 4) as retreating US Treasury yields bolstered demand for stocks, while investors awaited clues on how much further the US Federal Reserve would go with interest rate hikes to rein in surging prices. Data on job openings and factory orders will be in focus before the market opens, a day after a report showing weaker-than-expected manufacturing activity raised investor hopes that rising rates were taming demand for goods, helping the main indexes stage a strong rebound. However, Federal Reserve Bank of New York President John Williams argued on Monday that while there have been nascent signs of cooling inflation, underlying price pressures remain too high, which means the US central bank must press forward. The rebound in stocks on the first trading day of the final quarter follows the S&P 500's lowest close in nearly two years on Friday that capped its worst monthly performance since March … [Read more...] about Wall St futures jump as Treasury yields retreat
Share to Twitter Share to Linkedin Topline Stocks continued to rally during early Tuesday trading following one of their best trading days of 2022 as the market shakes off its worst fears that sent the market tumbling in September – though some warn the rally will be short-lived. Key Facts The Dow Jones Industrial Average rose 1.4%, 400 points, and is up 4% on the week after a 760-point spike Monday, its second-largest single-day rise of the year. The S&P 500 rose 1.7% and tech-heavy Nasdaq jumped 2.2%, building on their respective 2.6% and 2.3% gains Monday. Tesla shares rose 4% early Tuesday after a dramatic 9% loss Monday, as several banks expressed optimism about the electric vehicle maker’s long-term prospects after third-quarter vehicle deliveries fell short of analyst estimates. Driving this week’s gains are investors’ increasing cautious optimism about monetary policy globally. The market welcomed the Australian … [Read more...] about Stock Market Opens Up Big As It Looks To Build On Massive Gains
Share to Twitter Share to Linkedin Shopify stock (NYSE: SHOP) continues to drift lower, falling by about 10% over the past month, taking its year-to-date decline to about 80%. While a bulk of the decline in the stock came earlier this year, as investors fled growth stocks as the Fed began its monetary tightening, Shopify’s underlying e-commerce business is also taking a hit as people return to physical stores, with high inflation and rising rates also weighing on consumer confidence. Shopify posted a tough set of Q2 2022 results with revenue growth slowing to 16% year-over-year versus the 57% growth the company posted in the year-ago quarter, with the company also swinging to a net loss, versus a profit a year ago. Now, given the magnitude of the rout in Shopify stock, it’s safe to assume that much of the recovery will hinge on macros. Thus far, the Fed has also not shown signs that it will ease on its rate hikes, with the bank raising rates yet again by … [Read more...] about Down 80% This Year, What Will It Take For Shopify Stock To Recover?
Share to Twitter Share to Linkedin Our theme of Mid-Cap SaaS stocks has fallen by about 42% year-to-date, underperforming the broader Nasdaq-100, which remains down by roughly 33% over the same period. The initial leg of the sell-off in software stocks was driven by investors adjusting their allocations and valuations of stocks to account for the Federal Reserve’s monetary tightening - the benchmark federal funds rate now stands at over 3%, from just about 0.25% at the beginning of this year. We’ve now reached a point where earnings growth for major software players is beginning to look a bit vulnerable, considering rising inflation, a softening economy, and the easing of the Covid-19 era demand tailwinds for technology products. This is putting further pressure on stock prices within the sector. So what’s the outlook like for the theme? Now, the macro environment remains tough with U.S. GDP contracting over the last two consecutive quarters and the Fed … [Read more...] about Are Mid-Cap Software Stocks Good Value Post The Tech Rout?
- A + A BENGALURU (Oct 4): The Nasdaq led Wall Street higher on Tuesday as megacap growth and technology stocks gaining and US Treasury yields declined amid growing investor speculation that the Federal Reserve would temper its aggressive rate hike path. New orders for US-manufactured goods remained unchanged in August as expected, while US job openings, a measure of labour demand fell by the most in nearly 2-1/2 years in August. Following the economic data, yields on government bonds dipped for a second day on hopes of moderation in monetary policy even though San Francisco Federal Reserve Bank President Mary Daly said the central bank needs to deliver further interest rate hikes. "Job openings data coming in lower than expected points to a weakening labour market. If confirmed by the non-farm payrolls report on Friday it could give the Fed the cover to slow down its tightening," said Thomas Hayes, chairman and managing member of New York-based Great Hill Capital. … [Read more...] about Growth stocks lift Nasdaq 3% as Treasury yields ease
- A + A WASHINGTON (Oct 4): US job openings fell by the most in nearly 2-1/2 years in August, though staying at high levels as demand for labour remains fairly strong, which could keep the Federal Reserve on its aggressive monetary policy tightening path. Job openings, a measure of labour demand, dropped 1.1 million to 10.1 million on the last day of August, the Labor Department said in its monthly Job Openings and Labor Turnover Survey, or JOLTS report, on Tuesday. August's decline was the largest since April 2020, when the economy was reeling from the first wave of the Covid-19 pandemic. Data for July was revised lower to show 11.17 million job openings instead of 11.239 million as previously reported. Economists polled by Reuters had forecast 10.775 million vacancies. The Fed is trying to cool demand for labour and the overall economy to bring inflation down to its 2% target. The US central bank has since March hiked its policy rate from near zero to the … [Read more...] about US job openings post biggest drop in nearly 2-1/2 years in August