- The Dow Jones Industrial Average increased 34 points, or 0.1%, at 09:35 ET (13:35 GMT), the S&P 500 gained 8 points, or 0.2%, and the NASDAQ Composite gained 10 points, or 0.42%, at the same time.
- By Friday’s close, the formal end of 2024, the first half of 2024 is on track for significant increases for the key indexes. The NASDAQ Composite has increased by 19%, the S&P 500 is expected to gain 15% so far this year, and the Dow Jones Industrial Average has only gained 4%.
PCE data points to a decline in inflation.
- According to the Federal Reserve’s preferred measure of price rises, inflation in the United States declined as anticipated in May compared to the previous month, which may provide the Fed greater motivation to begin cutting interest rates in 2024.
- Following a 0.3% increase in April, the headline personal consumption expenditures price index was level every month. In the year ending in May, the percentage decreased from 2.7% to 2.6%.
- In the meanwhile, the so-called “core” PCE, which excludes volatile goods like gasoline and food, decreased to 2.6% annually and 0.1% monthly.
- The Federal Reserve uses this highly monitored inflation indicator as its primary indicator, and the current slowdown in price pressure will probably make the argument for interest rate reductions this year stronger.
- Although market players still generally anticipate two rate cuts beginning in September in the hopes of a prolonged downward trend in price pressures, the Fed is only projecting one interest rate decrease this year, in December.
- President of the San Francisco Federal Reserve Bank Mary Daly said on Friday that she thinks inflation is progressively declining and that the most recent statistics showing that prices did not increase at all in April and May is “good news that policy is working.”
- “There is proof that the policy is sufficient,” Daly said in an interview with CNBC. “It’s rather difficult to look around and not see monetary policy in action. There is a slowdown in the labor market, consumption, growth, and inflation.”
- Nevertheless, Daly said that more policy work has to be done and that she anticipates inflation to remain over the Fed’s 2% target until maybe the end of 2025.
Results of the Presidential Debate
- Investors are also analyzing the first presidential debate between Donald Trump and Joe Biden, the Democratic and Republican contenders for 2024.
- During the majority of the much-awaited 90-minute discussion between Biden and Republican rival Donald Trump on Thursday, he seemed to stumble over the questions posed by the moderators.
- Throughout his speech, Biden’s extended pauses and raspy voice completely obscured his criticism of Trump’s recent criminal conviction and his unwillingness to adhere to democratic standards. Meanwhile, Trump criticized Biden’s track record in both diplomatic and economic affairs.
Nike falters on a reported drop in sales.
- Nike’s (NYSE:NKE) stock fell more than 17% after the sportswear giant informed investors that a 10% decline in sales is anticipated in the current quarter.
- Additionally, sales are predicted to decline by a mid-single-digit percentage in the current fiscal year.
- After CNN’s flash poll revealed that Republican candidate Trump Media & Technology Group (NASDAQ: DJT) had beaten US President Joe Biden in the first presidential debate, the stock of the company increased by 6%.
- Following Nokia’s (HE: NOKIA) announcement of intentions to acquire a U.S. manufacturer of optical networking gear for $2.3 billion, Infinera’s (NASDAQ: INFN) shares shot up about 20% as the company looked to capitalize on the billions of dollars that are being invested in data centers to support the burgeoning field of artificial intelligence.
Crude is expected to increase each week.
- As worries about decreasing demand were mostly outweighed by fears of supply interruptions in Russia and the Middle East, crude prices increased on Friday, heading for a winning week for a record third time.
- WTI (U.S. futures for crude oil) was up 0.2% at $81.94 per barrel at 09:35 ET, while Brent was up 0.2% at $85.43 per barrel.
- Both WTI and Brent futures have increased by around 2% so far this week, and both benchmarks are expected to rise by about 6% in June.
- Markets were on edge due to interruptions in crude supplies due to fears of a bigger conflict between Israel and Hezbollah in Lebanon. Additionally, strikes by Ukraine on key Russian fuel facilities suggested that there would be problems in Moscow’s oil supply.
- Because of the geopolitical tensions, oil prices have a larger risk premium among traders.
Source:
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