The much-anticipated Federal Reserve interest rate cut may finally arrive this week. Policymakers at the central bank are set to announce their decision on Wednesday. With inflation slowing and job growth cooling off, there’s a 59% chance that the Federal Reserve will cut its target interest rate by 0.5 percentage points, according to the CME FedWatch tool.
This decision follows a strong week for U.S. stocks, with the S&P 500 gaining approximately 4%, the Nasdaq Composite climbing nearly 6%, and the Dow Jones Industrial Average rising by 2.6%. Investors have been keenly observing economic indicators, and a rate cut would signal the Fed’s willingness to stimulate the economy further.
U.S. Treasury Yields Remain Steady
As investors await the Federal Reserve’s interest rate decision, U.S. Treasury yields were flat on Monday.
At 7:12 a.m. ET, the yield on the 10-year Treasury note had dipped by less than one basis point, sitting at 3.644%. The 2-year Treasury yield also dropped by approximately 2 basis points to 3.561%. Yields and prices generally move in opposite directions, and with one basis point equaling 0.01%, the movement on Monday was minimal. Investors seem to be holding their breath for the Fed’s upcoming decision, which could bring more significant fluctuations in the bond market.
Boeing Strike: A Growing Concern
Boeing (NYSE:BA) is currently facing a challenging labor strike that could drag on for some time, according to Jon Holden, a union leader representing over 30,000 striking employees.
In a recent radio interview, Holden suggested that the union has considerable leverage and power, which workers expect to be utilized in negotiations.
The strike began after workers overwhelmingly voted against a tentative deal that would have included a 25% wage increase over four years. Employees are pushing for better pay and pensions, and their strike action is occurring at a critical time for Boeing. The company has been dealing with production delays and regulatory scrutiny related to the safety of its jets. A prolonged strike could significantly affect Boeing’s finances, which are already under strain. The company’s stock price fell by 3.7% on Friday, and its shares have lost more than 37% of their value this year.
This Week's Events (World)
| Day | Event | Details |
|---|---|---|
| Tuesday | ?? Canada Inflation Rate | Forecast to fall from 2.5% to 2.4% |
| Wednesday | ?? Japan Trade Data | Forecast to show a slight decrease in trade deficits |
| Wednesday | ?? UK Inflation | Headline inflation rate forecast to be 2%, down from 2.2% in July |
| Thursday | ?? UK Interest Rate Decision | Benchmark rate expected to remain at 5% |
| Friday | ?? Japan Inflation Rate & BOJ Decision | Inflation rate expected to rise from 2.8% to 3%, BOJ expected to keep key rate at 0.25% |
Today's Premarket Movers:
| Company | Ticker | Stock Movement | Details |
|---|---|---|---|
| Pfizer | NYSE:PFE | +0.5% | Experimental drug for cancer patients showed positive midstage trial results |
| Boeing | NYSE:BA | +0.3% | Stock rose after a 3% drop on Friday; strike by 30,000 workers continues, talks to resume Tuesday |
| Intel | NASDAQ:INTC | +1.2% | Qualified for up to $3.5 billion in federal grants for making semiconductors for the U.S. Department of Defense |
| Tesla | NASDAQ:TSLA | +0.1% | Reported a 1.2% increase in July registrations, driven by 5,175 Cybertruck deliveries |
| Apple | NASDAQ:AAPL | -2.3% | Initial demand for iPhone 16 series appeared underwhelming, according to Jefferies and Citi |
| Target | NYSE:TGT | +0.3% | Announced plans to hire 100,000 seasonal employees for the holiday period |
| Apollo Global Management | NYSE:APO | +1.2% | Announced a $1 billion deal with BP to fund the energy giant's stake in the Trans Adriatic pipeline |
| Trump Media & Technology Group | NASDAQ:DJT | +1.2% | Gains added to Friday's near 12% rise after Donald Trump said he won't sell shares when the lockup period ends |
