Stock Market Update

[BRIEFING.COM] The S&P 500 (-0.4%), Nasdaq Composite (-0.4%), and DJIA (-0.3%) trade with modest losses, though well off their session lows just before midday. 

The market opened to significant pressure in mega-cap names across the consumer discretionary (-1.1%), communication services (-0.5%), and information technology (-0.1%) sectors, with substantial improvements in the technology sector helping to narrow losses at the index level.

The Vanguard Mega Cap Growth ETF now holds a modest 0.4% loss after being down more than 1.0%. 

Only the energy sector (+0.6%) trades above its flatline despite a modest decrease in the price of oil today.

Meanwhile, the health care sector (-1.7%) is the top laggard, with all but three of its components facing a loss.

The smaller-cap Russell 2000 (-1.0%) and S&P Mid Cap 400 (-0.8%) are underperforming as a positive batch of economic data weakened the case for further rate cuts this year. 

The probability of a 25-basis point rate cut at the October FOMC meeting now stands at 85.5%, down from 91.9% yesterday, according to the CME FedWatch tool. The probability of an additional 25-basis point rate cut at the December FOMC meeting now stands at 63.4%, down from 73.3% yesterday.

Kansas City Fed President Jeffrey Schmid (FOMC voting member) said that current economic policy is slightly restrictive, which he views as an appropriate stance, while Fed Governor Stephen Miran (FOMC voting member) told Bloomberg that the Fed should act "proactively" with a larger series of rate cuts.