US Market and Intel: A Two-Way Rally Street ?
On Mon, 23 Sep 2024 - US stocks rose, as the Dow Jones Industrial Average (^DJI) and S&P 500 (^GSPC) eked out record closes, extending a winning streak on Wall Street.
The gains were modest and appeared to be a continuation of last week’s rally after the Fed cut interest rates by a half percentage point (-0.5%). (see below)
When market called it a day:
DJIA: +0.15% (+61.29 to 42,124.65).
S&P 500: +0.28% (+16.02 to 5,718.57).
Nasdaq: +0.14% (+25.95 to 17,974.27).
Best Performing Sectors.
Monday’s winning sectors:
Although unspoken, US market’s concerned about US economic health remains, despite the Fed's bold jumbo interest rates cut last Wednesday.
Big question now is whether upcoming data releases this week will support Fed Chair Jerome Powell's assertion that US economic conditions remain strong.
S&P Global Flash PMI.
As mentioned in my post (click here ! to read & repost) dated 23 Sep 2024, this “advanced” report is closely watched.
Early survey indicators for September 2024, points to an economy that continues to grow at a solid pace.
Under the backdrop of (1) a weakened manufacturing sector and (2) intensifying political uncertainty acting as substantial headwinds.
Interactive Brokers, Senior economist - José Torres confirmed “Servicers reported stellar demand“.
The report appeared to reinforce the soft-landing narrative that US equity investors have hung on to.
A reacceleration of inflation is also signaled, suggesting the Fed cannot shift its focus (100%) away from its inflation target as it seeks to sustain the economic upturn.
Other Reports.
On Tue, 24 Sep 2024, traders will be mulling over fresh economic data beginning with:
The Conference Board’s consumer confidence reading for September 2024.
The Richmond Fed manufacturing index for September 2024.
All the while, investors are still looking to (a) Fed ‘s speakers and (b) the key inflation reading for clues to the odds of another big rate cut.
FOMC socialisation.
On Mon, 23 Sep 2024 - investors received more policy insight from Fed officials - Raphael Bostic & Neel Kashkari who explained why they were in favor of reducing interest rates by a jumbo 50 basis points instead of a smaller first cut, citing (a) progress on inflation and (b) a cooling job market.
In addition, Chicago Fed president Austan Goolsbee also said Monday he was "comfortable" with a 50 basis point cut, viewing it "as a demarcation" that the central bank is now back to thinking as much about achieving maximum employment as it is price stability.
If the Fed wants to avoid a recession, he added, then "we can’t be behind the curve."
Intel Bright Sparks.
Below is the latest follow up to my post on $Intel(INTC)$ dated 23 Sep 2024. (click click ! to read & repost).
There were 2 developments on the Intel front, that have helped to raise Intel’s stock price. (see below)
The recent rumors of $Qualcomm(QCOM)$ potentially acquiring Intel, coupled with Apollo Capital's loan to the chip giant, have ignited intense speculation in the tech industry.
While a Qualcomm-Intel merger might seem like a bold move to strengthen both companies' positions in the semiconductor market, it's a complex proposition with numerous implications (eg. antitrust).
Apollo Capital's unique relationship with Intel is a key factor to consider.
As a major lender to the company, Apollo has a vested interest in Intel's financial health.
The loan could be seen as a strategic move to stabilize Intel's position and potentially pave the way for a more favorable acquisition environment.
Whatever the final outcome is, the “positive” vibes have already filtered through - allowing Intel’s price to bubble up. Agree ?
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