Markets get a small boost with the conclusion of the Jackson Hole Economic Symposium

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Published Date 8/23/2024

At 9:30 am ET this morning the DJIA opened +173, NASDAQ +132, S&P +30. 10 year at 9:30 am 3.84% -2 bps. FNMA 5.5 30 year coupon at 9:30 am +6 bps from yesterday’s close and -5 bp from 9:30 am yesterday.

At 10:30 am the DJIA +418, NASDAQ +308, S&P +67. 10 year note at 10:30 am 3.82% -4 bp, 2 year note 3.96 -5 bp. FNMA 5.5 30 year coupon at 10:30 am +21 bps on the day and +14 bps from 9:30 am.

Chairman Powell spoke at 10 am, prior to his comments markets were expecting a 25 bp cut in the FF rate at the September 18th meeting. Started by saying the monetary policy will depend on incoming data, not anything different than what he has said previously and what most other fed officials have been saying. His confidence is increased that inflation is slowing. The labor market has cooled and not a factor in inflation. The Fed will do what it can to support a strong labor market. Inflation has increased because of the pandemic, now moving closer to the Fed’s target. He said he is comfortable with the outlook of inflation. The balance of risk to inflation is coming down, the risk of unemployment still a factor but the labor market is softening. The economic distortions caused by the pandemic are dissipating. At the end of it, rate cuts are data dependent.

Between now and the FOMC meeting on the 18th of September, one employment report, three key inflation reports.

July new home sales at 10 am expected at 628K but increased to 739K and June sales were revised from 617K to 668K. On a month/month basis sales increased 10.6% in July from -0.60% in June and +5.6% year/year. The median price in July $429,800 down from $435,800 one year ago.

Source: TBWS

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