Category Archives: U.S. Economic News

Major asset manager warns on election, stocks risk

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[10/25/24]The S&P 500 has jumped 22% so far this year.

Many investors are trying to figure out what impact the presidential election will have on stocks. Looking back at prior elections provides helpful context.

Let’s start with George W. Bush’s victory in 2000. The S&P 500 fell 13% in 2001 and 23% in 2002. But it’s hard to blame that on Bush.

Stocks already were sliding in 2000 as the dot.com bubble began to burst. Bill Clinton caught the right end of the economic cycle in 1993-2000, and Bush caught the wrong end.

But then Bush benefited from the inevitable economic rebound. His tax cuts helped drive it, though they also widened...

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Buckle up: Stocks face huge test from Fed and earnings storm

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[7/29/24]The Fed meets, a jobs report is ahead, along with earnings reports from Microsoft, Apple, Meta and Amazon. Buckle up, investors. The week ahead may offer a bumpy ride. The week has more than enough of everything: a Federal Reserve meeting, the June jobs report and more than 1,000 earnings reports from companies giant, huge, big and small. The schedule comes after a volatile week:
  • The S&P 500 fell 0.8%. The Nasdaq Composite fell 2.1%, with the Nasdaq-100 index down 2.6%. Yet, the Dow had a small gain, and the small-cap Russell jumped 3.5% as investors pushed money to non-tech investments.
  • The major averages are no longer overbought but, rather, oversold. A key indicator...
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Big Nvidia results, decent housing reports will boost markets

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[5/19/24]The chip giant is the biggest of big stocks that report results this week to go along with important housing data. Normally, you get into this time of May and the big crush of earnings reports eases off, giving investors a breather in time for the Memorial Day Holiday. Not this year. This week brings a number of market-moving earnings reports that bulls hope will fuel a continuation of last week's big rally. In addition, two big housing reports will show whether the residential real estate market is showing signs of life. Last week saw the major indexes hit new highs, including the Dow Jones Industrial Average's dramatic last-second push...
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Fed holds rates steady; sees 3 rate cuts in 2024 but nods to inflation risks

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[3/20/24]The Federal Reserve held rates steady for an eighth consecutive month, while holding to its forecasts of around three rate cuts in 2024, but the central bank hinted that stubborn inflation might delay any moves until later in the year. The policy-making Federal Open Market Committee held its key rate at between 5.25% and 5.5%, the highest in 22 years, a unanimous move that Wall Street widely expected following the central bank's two-day policy meeting in Washington. The Fed's last rate move, a quarter-point increase, came in July 2023. The newly released Summary of Economic Projections, known informally as the 'dot plots, indicates around 0.75 percentage point of rate reductions this...
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Can the stock market reclaim its mojo?

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[1/7/24]It's fair to say there was surprise, nay, disappointment that the great 2023 end-of-year rally ended, well, at the end of 2023.

The major averages all fell in the first week of January, with big technology stocks absorbing some of the biggest declines after investors were cheered by a huge nine-week rally and hoped for continued gains ahead.

The declines began to emerge on Dec. 29, after the Standard & Poor's 500 Index  (^IN)  came close to -- but failed -- to set a new all-time high. At the time, most of the major averages had been signalling the market was overbought.

Maybe the gains will start up again. One...

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The risks ahead for gold in a high-rate environment

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[10/24/23]Gold will continue to show strength in the face of U.S. rate hikes, rising expectations for a soft landing and heightened geopolitical risks, according to Joseph Stefans, Head of Trading at precious metals house MKS PAMP. While the Federal Reserve’s “higher-for-longer” narrative is depressing prices, the precious metal has remained surprisingly resilient as governments around the world continue to accumulate it amid growing economic and political risks. “Most assets are impacted by the Fed and its path in terms of whether it is looking to hike or aggressively hike in the foreseeable future and gold is no exception,” said Stefans, responding to a question from Jin Hennig,...
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BofA Sees Economy Sticking a Soft Landing

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[8/3/23]Many experts predicted a recession last year, but a lot of them are changing their tune this year. Many economists began forecasting recession last year, but a downturn obviously hasn’t happened yet, with the economy expanding an annualized 2.4% in the second quarter. And now the experts are starting to change their tune. That includes Bank of America economist Michael Gapen. “Recent incoming data has made us reassess our prior view that a mild recession in 2024 is the most likely outcome,” he wrote in a commentary.
“Growth over the past three quarters has averaged 2.3%, the unemployment rate has remained near all-time lows,...
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ChatGPT Might Not Threaten Your Job as Much as the Hype Suggests It Will

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[5/8/23]New technologies poised to boost productivity more than replace jobs, analyst argues. Artificial intelligence is that one big story right now. It’s cropping up in tons of headlines, and it always seems to be associated with a risk of now or future job loss as the new technology -- launched so effectively with OpenAI’s ChatGPT -- continues to prove and upgrade its ability to research, write and bring a lot of potential efficiency to the workplace. IBM’s CEO said Monday that the company will pause hiring for jobs that could be accomplished by AI, and suggested that nearly 8,000 jobs could be affected. A March report...
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The Next Industry to Do Major Layoffs, Per a Recent Survey

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[3/6/23]As a potential recession looms, leaders are grappling with cost-cutting measures that sometimes include workforce reductions. As many experts continue to predict an upcoming recession, much of the focus has been on layoffs in the technology sector. Another industry is also is feeling squeezed in terms of the ability to pay all of its employees. Coupa CFO Tony Tiscornia said education industry CFOs cited workforce reductions as an expected action in the next six to 12 months to drive growth in the event of a recession, according to Fox Business.
E-learning company Udemy announced on Feb. 14 that it would be...
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Gas Prices Steady For Now – But Here’s Where They’re Headed

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[1/13/23]Gasoline prices have been rising at a slow pace, which is a boon for drivers. Gasoline prices remain stable and have risen only slightly as demand returns. The national average is $3.26 per gallon, which is down $0.05 from a week ago, but rose by $0.05 from a month ago, said Patrick De Haan, head of petroleum analysis at GasBuddy, the Boston provider of retail fuel pricing information. The price of diesel is selling for $4.62 a gallon on average, which is a decline of $0.07 a gallon during the pat week. Demand for gasoline has risen steadily since people have resumed their daily driving habits.
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