With the Federal Reserve meeting scheduled for later this month, investors are closely monitoring economic data to gauge the potential size of the expected interest rate cut. This is causing some volatility in the market, with US stock futures pulling back on Friday.
Tech stocks, in particular, are leading the declines, with Nasdaq 100 futures down 1.1%. The S&P 500 and Dow Jones Industrial Average futures also retreated by 0.6% and 0.3% respectively.
The debate around the possibility of a 0.25% or 0.5% rate cut at the upcoming Fed meeting is intensifying as softer labor market readings raise concerns about a possible recession. Investors are eagerly awaiting the release of the August jobs report, which is expected to show a rise in nonfarm payrolls.
According to the CME FedWatch tool, the market is currently pricing in a 41% chance of a deeper rate cut from the Fed, up from 30% just a week ago. This uncertainty is contributing to the increased volatility in the market.
In addition to the market as a whole, individual companies are also feeling the effects of these economic uncertainties. Chipmaker Broadcom, for example, saw its shares fall in pre-market trading following a disappointing sales forecast. While the company is benefiting from increased AI spending, other divisions are falling short.
As the markets continue to react to incoming data and speculation about the Fed’s next move, investors will need to stay informed and adapt to the changing conditions. Extreme Investor Network is committed to providing its members with up-to-date information and expert analysis to help them navigate these uncertain times and make informed investment decisions. Stay tuned for more insights and updates from Extreme Investor Network.