Pre-Markets Climb on Rate Cut Visibility
Headline Philly Fed manufacturing came in at -4.0 for June, equalling the prior month's level and notching the third-straight month lower. Business conditions, capital expenditures, new orders and prices paid were all lower last month. And the Employment Index sank lower than expected, to -9.8. This could be seen as a further indication of a softening labor market in the U.S.Pre-market traders are not missing this opportunity: a sinking Employment Index, while a relatively minor part of the Philly Fed Index (which focuses on the region around Philadelphia and the goods-producing sector there), do point to an opening for the Fed to lower interest rates at some point in the future. But the Fed would have to see demonstrably worse employment numbers first.
We will most certainly track this new infusion of positivity into the stock market; it may even bring us a positive trading week over all, depending on the size of gains. We also have to keep our eyes and ears open about potential trade deals ahead of the July 9th deadline, as well as any new developments in the Middle East, on which President Trump has cooled his rhetoric (with yet another self-imposed deadline of two weeks before making a decision on whether to make a move on Iran).After today's open, the latest U.S. Leading Economic Indicators (LEI) report will come out for the month of May. Expectations are for a headline to drift marginally negative: -0.1%, from a deeper -1.0% for April and -0.8% for March. We are now scraping 9-year lows on LEI — well off the late 2021/early 2022 highs.For April, all components were lower except Lending Credit and Manufacturing New Orders, both of which were up marginally. Meanwhile, the Coincident Economic Index (CEI) has fully recovered from Covid-era lows to keep its upward trajectory. While the LEI is a leading indicator for growth, the CEI reflects current economic conditions.
It's a big data week starting on Monday. Various prints on the housing market, Services and Manufacturing PMI, Durable Goods, Jobless Claims and Personal Consumption Expenditures (PCE) — a week from today — will all be hitting the tape. PCE levels in particular are important, as they tend to have a pronounced effect on future Fed monetary policy decisions.Questions or comments about this article and/or author? Click here>>
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Miami Herald
21 minutes ago
- Miami Herald
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The three-year annualized average return on gold, as measured by SPDR Gold Shares (GLD) , is 23.4%, well above its historic averages; from 1971 to 2024, the annualized return on the shiny stuff was just under 8%. Gold's rise hasn't been as a result of its traditional role as a hedge against inflation, because it normally takes a protracted time period with prices rising by more than 5% for gold to kick in that way. Instead, gold has been seen as an ideal hedge against geopolitical risk, the fighting in Ukraine and Gaza, the prospect of trade wars coming from the tariffs, and more. With no end in sight to those problems, plenty of investors have become gold bugs, looking to precious metals for protection and profits in times of uncertainty. 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Business Insider
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Palantir or AMD: UBS Picks the Superior AI Stock to Buy After Earnings
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Miami Herald
37 minutes ago
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If Tesla can match or exceed Waymo's operational scale while clearing regulatory and safety bottlenecks, the payoff could be transformative. Tesla just checked off a major box in its push to dominate the robotaxi space. The EV behemoth just secured a critical rideshare license in Texas, which clears the way for its Robotaxi service to operate in the state. The breakthrough puts Elon Musk's company in the same regulatory category as Uber and Lyft, but without the human driver. More News: Veteran analyst drops 6-word verdict on Apple's $100 billion investmentBank of America drops shocking price target on hot weight-loss stock post-earningsJPMorgan drops 3-word verdict on Amazon stock post-earnings Also, the timing effectively lines up with a shift in the state's law. Starting September 1, Texas will need autonomous rideshare services to meet the same regulatory standards as traditional ones. That includes mandatory cameras, insurance coverage, and adhering to traffic laws, which adds another layer of accountability to the whole operation. The license builds on Tesla's recent Robotaxi pilot in Austin. With Texas in the bag, Tesla is looking at Nevada, Arizona, California, and Florida next. These states have been a lot more open to the daunting autonomous driving technology. Tesla's regulatory woes are far from settled, but the Texas license marks a major step toward its CEO's vision for a driverless future. Related: Morgan Stanley resets AMD stock price target after earnings The Arena Media Brands, LLC THESTREET is a registered trademark of TheStreet, Inc.
