Strong September Retail Sales Put Fed's Next Move In Doubt: Interest Rate Cuts Are 'Not A Slam Dunk'
Portfolio Pulse from Piero Cingari
Stronger-than-expected September retail sales have sparked debate about the Federal Reserve's next interest rate move, with analysts reconsidering the likelihood of a rate cut in November. The retail sales data led to a rise in Treasury yields, impacting Treasury-related assets and stock market gains.
October 17, 2024 | 4:20 pm
News sentiment analysis
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NEGATIVE IMPACT
The iShares 20+ Year Treasury Bond ETF (TLT) fell 1.5% as Treasury yields rose sharply following strong retail sales data.
The rise in Treasury yields directly impacts TLT, which tracks long-term Treasury bonds. Higher yields typically lead to lower bond prices, causing TLT to drop.
CONFIDENCE 90
IMPORTANCE 70
RELEVANCE 80
NEUTRAL IMPACT
The Invesco QQQ Trust, which tracks the Nasdaq 100, rose 0.7% despite initial gains being tempered by rising Treasury yields.
While QQQ initially rose over 1%, the increase in Treasury yields likely dampened further gains, reflecting mixed investor sentiment.
CONFIDENCE 85
IMPORTANCE 50
RELEVANCE 60
POSITIVE IMPACT
The SPDR Gold Trust (GLD) rose 0.7%, reaching new all-time highs as investors sought safe-haven assets amid economic uncertainty.
Gold prices, and consequently GLD, tend to rise when investors seek safe-haven assets, especially amid economic uncertainty and rising yields.
CONFIDENCE 90
IMPORTANCE 60
RELEVANCE 70