July Inflation Rate Falls More Than Expected, Supports Hopes For Large Fed Rate Cuts
Portfolio Pulse from Piero Cingari
The Consumer Price Index (CPI) for July showed a lower-than-expected annual increase of 2.9%, supporting hopes for significant interest rate cuts by the Federal Reserve. This marks the fourth consecutive decline in the annual inflation rate. Market reactions were muted, with S&P 500 futures up 0.1% and Nasdaq 100 futures flat. Treasury yields slightly increased. The SPDR S&P 500 ETF Trust (SPY) and Invesco QQQ Trust (QQQ) had strong performances earlier in the week.
August 14, 2024 | 12:42 pm
News sentiment analysis
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POSITIVE IMPACT
The Invesco QQQ Trust (QQQ) rallied 2.5% earlier in the week and is likely to benefit from the lower-than-expected inflation rate, which supports hopes for significant Fed rate cuts.
The lower-than-expected inflation rate supports market hopes for significant Fed rate cuts, which is generally positive for equities. QQQ had already shown strong performance earlier in the week, indicating investor optimism.
CONFIDENCE 90
IMPORTANCE 70
RELEVANCE 80
POSITIVE IMPACT
The SPDR S&P 500 ETF Trust (SPY) saw a 1.6% gain earlier in the week and is likely to benefit from the lower-than-expected inflation rate, which supports hopes for significant Fed rate cuts.
The lower-than-expected inflation rate supports market hopes for significant Fed rate cuts, which is generally positive for equities. SPY had already shown strong performance earlier in the week, indicating investor optimism.
CONFIDENCE 90
IMPORTANCE 70
RELEVANCE 80