Treasury Yields Plunge, TLT ETF Tops $100, VIX Spikes As 50-Basis-Point Rate Cut Odds Soar In Response To Jobs Data
Portfolio Pulse from Piero Cingari
The U.S. Treasury market rallied as August labor data showed weaker-than-expected job growth, increasing the likelihood of a Federal Reserve rate cut. This led to a surge in Treasury-related ETFs like TLT, a drop in equity markets including SPY and QQQ, and a spike in volatility as measured by the VIX.
September 06, 2024 | 3:52 pm
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NEGATIVE IMPACT
Nvidia Corp. (NVDA) tumbled 4%, extending its weekly loss to 14%, as tech stocks were hit hard by the market's reaction to weak jobs data.
Nvidia, as part of the tech sector, was significantly impacted by the negative market sentiment following the jobs data.
CONFIDENCE 80
IMPORTANCE 65
RELEVANCE 70
NEGATIVE IMPACT
The Invesco QQQ Trust (QQQ) fell 2.4%, with tech stocks hit hardest by the market's reaction to weak jobs data and rate cut expectations.
Tech stocks, represented by QQQ, were particularly affected by the market's negative reaction to the jobs data and rate cut expectations.
CONFIDENCE 85
IMPORTANCE 70
RELEVANCE 75
NEGATIVE IMPACT
The SPDR S&P 500 ETF Trust (SPY) dropped 1.5% as equity markets reacted negatively to the weak jobs data and increased rate cut expectations.
The weak jobs data and potential rate cuts led to a sell-off in equities, negatively impacting SPY.
CONFIDENCE 85
IMPORTANCE 70
RELEVANCE 80
POSITIVE IMPACT
The Invesco CurrencyShares Japanese Yen Trust (FXY) gained over 1% as the yen strengthened amid market volatility and rate cut expectations.
The yen, represented by FXY, strengthened as investors sought safe-haven assets amid market volatility and rate cut expectations.
CONFIDENCE 75
IMPORTANCE 60
RELEVANCE 60
POSITIVE IMPACT
The iShares 20+ Year Treasury Bond ETF (TLT) rose 1.1% to $100.65, driven by expectations of a Federal Reserve rate cut following weak jobs data.
The weak jobs data increased the likelihood of a rate cut, leading to a rally in Treasury bonds and a rise in TLT.
CONFIDENCE 90
IMPORTANCE 80
RELEVANCE 90