The S&P 500 Index ($SPX) (SPY) today is up by +0.04%, the Dow Jones Industrials Index ($DOWI) (DIA) is up by +0.93%, and the Nasdaq 100 Index ($IUXX) (QQQ) is down by -0.30%.
Stocks today are mixed, with the Dow Jones Industrials climbing to a new record high. Today’s US personal spending and income were weaker-than-expected and Fed-friendly. Also, the Aug core PCE price index, the Fed’s preferred inflation gauge, came in right on expectations, knocking T-note yields lower and supporting stocks. The reports also cemented expectations for further interest rate cuts by the Fed.
US Aug personal spending rose +0.2% m/m, slightly weaker than expectations of +0.3% m/m. Aug personal income rose +0.2% m/m, weaker than expectations of +0.4% m/m.
The US Aug core PCE price index rose +2.7% y/y, right on expectations.
Global equity markets have carryover support from today’s +2% rally in Chinese stocks to a 3-1/2 month high. China's Shanghai Composite has rallied more than +12% this week after government leaders boosted stimulus measures and pledged to support fiscal spending and revive economic growth.
The markets are discounting the chances at 100% for a -25 bp rate cut at the November 6-7 FOMC meeting and at 54% for a -50 bp rate cut at that meeting.
Overseas stock markets today are moving higher. The Euro Stoxx 50 rallied to a 3-1/2 month high and is up +0.59%. China's Shanghai Composite climbed to a 3-1/2 month high and closed up by +2.88%. Japan's Nikkei Stock 225 rose to a 2-month high and closed up +2.32%.
Interest Rates
December 10-year T-notes (ZNZ24) today are up +6 ticks. The 10-year T-note yield is down -2.9 bp at 3.768%. T-note prices are climbing on positive carryover from today’s rally in 10-year German bunds to a 1-1/2 week high. Also, today’s weaker-than-expected US Aug personal spending and income reports were bullish for T-notes. In addition, the US Aug core PCE price index came in right on expectations, a dovish factor for Fed policy.
European government bond yields today are moving lower. The 10-year German bund yield fell to a 1-1/2 week low of 2.109% and is down -4.3 bp at 2.140%. The 10-year UK gilt yield is down -3.7 bp at 3.973%.
The Eurozone Sep economic confidence indicator fell -0.3 to 96.2, weaker than expectations of 96.5.
The ECB's Eurozone Aug 1-year inflation expectations eased to a 3-year low of +2.7% from +2.8% in July, right on expectations. The Aug 3-year inflation expectations eased to +2.3% from +2.4% in July, right on expectations.
The French Sep CPI (EU harmonized) eased to +1.5% y/y from +2.2% y/y in Aug, better than expectations of +1.9% and the smallest increase in 3 years.
Swaps are discounting the chances of a -25 bp rate cut by the ECB at 60% for the October 17 meeting.
US Stock Movers
Chip stocks are moving higher today and are supporting gains in the overall market. ON Semiconductors (ON) is up more than +2%. Also, Intel (INTC) is up more than +1% to lead gainers in the Dow Jones Industrials. NXP Semiconductors NV (NXPI), Microchip Technology (MCHP), GlobalFoundries (GFS), and Analog Devices (ADI) are up more than +1%.
Wynn Resorts (WYNN) is up more than +4% to lead gainers in the S&P 500 after Mogan Stanley upgraded the stock to overweight from equal weight with a price target of $104.
Biomea Fusion (BMEA) is up more than +20% after Truist Securities upgraded the stock to buy from hold with a price target of $54.
Establishment Labs Holdings (ESTA) is up more than +14% after it received FDA approval for its Motiva breast implants.
TransMedics Group (TMDX) is up more than +7% after S&P Dow Jones Indices said the company would replace Ensign Group in the S&P SmallCap 600 before the opening of trading on October 1.
Bristol Myers Squibb (BMY) is up more than +1% after gaining FDA approval for its Cobenfy drug to treat patients with schizophrenia.
Amgen (AMGN) is up more than +1% after Cantor Fitzgerald initiated coverage on the stock with a recommendation of overweight with a price target of $405.
HP Inc. (HPQ) is down more than -4% to lead losers in the S&P 500 after Bank of America downgraded the stock to neutral from buy.
Costco Wholesale (COST) is down more than -2% after reporting Q4 net sales of $78.19 billion, below the consensus of $78.59 billion.
Cassava Sciences (SAVA) is down more than -9% after the company said two of its former executives agreed to pay more than $40 million to settle SEC charges that they made misleading statements about the results of an Alzheimer’s drug trial.
Intuit (INTU) is down more than -2% after forecasting full-year adjusted EPS of $19.16-$19.36, the mid-point below the consensus of $19.34.
Summit Therapeutics (SMMT) is down more than -8% after Citigroup downgraded the stock to neutral from buy.
Earnings Reports (9/27/2024)
NANO Nuclear Energy Inc (NNE) and Spire Global Inc (SPIR).
More Stock Market News from Barchart
- 2 Popular Stocks Wall Street Analysts Believe are Significantly Overvalued
- Why Eldorado Gold (EGO) Could Hit $20: A Technical and Fundamental Breakdown
- Regency Centers Stock: Is REG Underperforming the Real Estate Sector?
- Nvidia Stock Q4 Forecast: Will NVDA Crash or Bounce Back to Record Highs?
