09/08/2024 Daily Reports
- Gold prices eased to around $2,420 per ounce on Friday, following a nearly 2% rise in the previous session. Despite the dip, the metal continues to be supported by ongoing geopolitical tensions and expectations of a potential Federal Reserve rate cut. Escalating conflicts, including anticipated retaliatory strikes by Iran against Israel and a rare Ukrainian attack on Russia, have bolstered gold’s safe-haven appeal.
- Market expectations for a Fed rate cut in September remain, though investor predictions have become more cautious. The debate now centers on whether the Fed will opt for a 50 basis point reduction or a more modest 25 basis point cut. This shift in sentiment follows a significant drop in U.S. initial jobless claims, easing recession fears, alongside a strong ISM services PMI for July, which also suggested resilience in the labor market.
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- Stocks Rally: The S&P 500 surged 2.3%, marking its biggest gain since November 2022, as US jobless claims data eased recession fears. Nasdaq 100 jumped 3.1%, and Russell 2000 rose 2.4%. Nvidia and Eli Lilly led the gains.
- The Nikkei 225 and the Topix climbed on Friday as the yen held a small gain versus the dollar. The gauges remain down around 17% from their records reached last month.
- Bonds & Yields: Treasuries declined, with 10-year yields up four basis points to 3.99%. Weak demand for 30-year bonds added to the selloff.
- Currency & Crypto: The US dollar dipped 0.2%, while Bitcoin and Ether soared 7.8% and 9.6%, respectively. Bitcoin continued to rally in tandem with a rebound in Asian equities on Friday after a bruising selloff.
- Commodities: WTI crude climbed 1.1% to $76.09 a barrel; gold increased 1.7% to $2,423.75 an ounce.
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Oil set for 3% weekly gain on rising Mideast tension, better US outlook
The killing last week of senior members of militant groups Hamas and Hezbollah had raised the possibility of retaliatory strikes by Iran against Israel, stoking concerns over oil supply from the world’s largest producing region.
Fed’s Schmid says he’s more confident inflation heading to 2% goal
Kansas City Federal Reserve Bank President Jeff Schmid, one of the U.S. central bank’s more hawkish policymakers, said on Thursday that recent “encouraging” data gives him more confidence that inflation is cooling and sets the table for a reduction in the Fed’s interest rate.
Fed responds to economic data, not politics or stocks, says Chicago Fed’s Goolsbee
Chicago Federal Reserve Bank President Austan Goolsbee on Thursday reiterated that the central bank’s job is not to respond to stock market routs or political considerations.
As for the recent stock-market rout, he said, “We’re not in the business of responding to the stock market. We’re in the business of maximizing employment and stabilizing prices.”
Trump signals interest in influencing Federal Reserve decisions if he regains White House
Republican candidate Donald Trump said on Thursday that U.S. presidents should have a say over decisions made by the Federal Reserve, the most explicit indication so far of his interest in infringing on the central bank’s independence should he regain the White House. “I feel the president should have at least (a) say in there,” the former president told reporters at his Mar-a-Lago residence in Florida. “I think that in my case, I made a lot of money, I was very successful, and I think I have a better instinct than in many cases, people that would be on the Federal Reserve or the chairman.”
