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Is eight enough? We'll find out soon enough, but it has been quite a run for the S&P 500 and Nasdaq Composite, which have logged gains in the last eight trading sessions. Over that span, the S&P 500 is up 7.9% and the Nasdaq Composite is up 10.4%.
One can make a case that the market is due for a consolidation period, but that would have been the case yesterday, too, and, well, the indices logged some decent-sized gains.
There is an air of resilience to selling interest again this morning. Currently, the S&P 500 futures are unchanged and are trading in-line with fair value, the Nasdaq 100 futures are down seven points and are trading fractionally below fair value, and the Dow Jones Industrial Average futures are down 33 points and are trading fractionally below fair value.
The price action onus, it seems, is on the bears, because the bulls of late haven't been running into any interference.
Their pathway has been clear with participants once again embracing the soft landing scenario and the prospect of an imminent rate cut by the Federal Reserve. That consideration is effectively the best of both worlds.
There won't be any economic guidance on today's trading path since there are no U.S. releases of note on today's calendar. The stock market will be left to its own trading devices, which will revolve around price action, currency moves, and a smattering of news, some of which involves monetary policy considerations.
On the latter note, the People's Bank of China left its 1-yr and 5-yr loan prime rates unchanged at 3.35% and 3.85%, respectively, as expected; Sweden's Riksbank cut its policy rate by 25 basis points to 3.50% and said 2-3 more cuts could happen this year if the inflation outlook remains the same; and ECB member Rehn suggested growth risks raise the prospect of another ECB rate cut at the September meeting.
Conversely, the minutes for the latest Reserve Bank of Australia meeting indicated it is unlikely that there will be a rate cut in the short term.
The Federal Reserve's policy deliberations will come into sharper focus Wednesday with the release of benchmark revisions for nonfarm payrolls and the minutes for the July 30-31 FOMC meeting. Then, there is Friday's speech on the Economic Outlook by Fed Chair Powell at the Jackson Hole Economic Symposium.
The 2-yr note yield is down three basis points to 4.04% and the 10-yr note yield is down one basis point to 3.86%, as Treasuries maintain a hopeful view of the rate cut and inflation situation. The U.S. Dollar Index is down 0.1% to 101.77, trading at its lowest level since early January.
Home improvement retailer Lowe's (LOW) isn't at its lowest level, but it is trading 0.5% lower after reporting better-than-expected Q2 earnings and issuing weaker-than-expected FY25 guidance. Palo Alto Networks (PANW), though, is trading 2.1% higher following better-than-expected fiscal Q4 results and issuing better-than-expected fiscal Q1 guidance.
Their reports and other corporate news items, like Eli Lilly (LLY) saying tirzepatide reduced the risk of developing type 2 diabetes by 94% in adults with pre-diabetes and obesity, and a Bloomberg report that Boeing (BA) has paused testing of its 777X plane to investigate cracks in a key part, haven't held much sway at the index level as market participants wait to see if eight is enough for the rally effort.
