Overview
The U.S. stock market ended in red, pressured by profit-taking and fears about September's historically weak performance. September is often a month where portfolio adjustments occur, leading to increased volatility. Despite Friday's downturn, the S&P 500 has maintained its upward momentum, marking a four-month streak of gains.
| Nasdaq Composite | S&P 500 |
| Dow Jones Industrial Average | 1 South Korean won equals |
Major News Story
Economic indicators presented mixed signals. In July, U.S. consumer spending saw its largest increase in four months, reflecting strong demand despite persistent inflation pressures. The Fed's favored core PCE price index rose 0.3% month-on-month and 2.9% year-on-year, the highest since February. Conversely, the University of Michigan’s consumer sentiment index hit a three-month low. Market focus is on the Fed's September monetary policy meeting, with rising expectations for a rate cut following weak employment data and Chair Powell's dovish remarks. Fed officials like Christopher Waller are backing a possible 25 basis point cut in September, with expectations of further cuts in the next 3 to 6 months, conditional on the employment report.
Tomorrow's Economic Indicators
| Announcement Time | Details |
|---|---|
| None |
General Opinion
Despite inflationary pressures, the economy remains robust, but the potential for monetary policy changes is heavily steering market sentiment. AI and tech stocks are particularly vulnerable, leading declines due to profit-taking. Investors are closely watching the upcoming employment report, which could be pivotal for the Fed's rate decisions. While caution is warranted during this historically volatile period, some believe any downturn might be short-lived. Analysts emphasize the importance of monitoring employment and inflation dynamics as they will significantly influence monetary policy directions.
