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Wall Street closed mixed on Monday ahead of the Fed’s crucial FOMC meeting this week. Market participants are overwhelmingly expecting the first rate to be initiated in September FOMC meeting. The Dow and the S&P 500 ended in positive territory while the Nasdaq Composite finished in negative zone.
How Did The Benchmarks Perform?
The Dow Jones Industrial Average (DJI) was up 0.6% or 228.30 points to close at 41,622.08, marking its new all-time closing high. Notably, 25 components of the 30-stock index ended in positive territory while 5 in negative zone. The blue-chip index posted a four-day winning run.
The tech-heavy Nasdaq Composite finished at 17,592.13, declining 0.5% due to weak performance by technology giants, especially AI-based semiconductor stocks. The tech-laden index terminated a five-day winning-streak.
The S&P 500 rose 0.1% to finish at 5,633.09. Wall Street’s benchmark is currently less than 1% below its all-time high recorded in July. The index also registered a six-day winning-streak.
Nine out of 11 broad sectors of the broad-market index ended in positive territory while two in negative zone. The Communication Services Select Sector SPDR (XLC), the Financials Select Sector SPDR (XLF) and the Energy Select Sector SPDR (XLE) advanced 1.1%, 1.3% and 1.1%, respectively.
The fear-gauge CBOE Volatility Index (VIX) was up 3.5% to 17.14. A total of 9.74 billion shares were traded on Monday, lower than the last 20-session average of 10.75 billion. Advancers outnumbered decliners on the NYSE by a 2.74-to-1 ratio. On Nasdaq, a 1.17-to-1 ratio favored advancing issues.
Markets Wait for Crucial Fed Meeting
The Fed will conduct its next FOMC meeting on Sept. 17-18. Market participants are currently riding on high expectations of the beginning of the interest rate cut regime by the Fed in the September FOMC meeting scheduled next week. The existing range of 5.25-5.5% marks a 23-year high level. If the Fed initiates a rate cut, it will be the first one since March 2020, at the onset of COVID-19.
The CME FedWatch tool currently shows a 100% probability of a 25-basis point interest rate cut in September and a 69% chance of a 50-basis-point rate cut. For November, market participants estimate a 100% probability that the total (year-to-date) rate cut will be 50 basis points and a 83.4% probability that the total rate cut will be 75 basis points. Likewise for December, market participants estimate a 100% probability that the total rate cut will be 75 basis points and a 94.3% probability that the total rate cut will be 1% in 2024.
Last month, in his speech at the Fed’s Jackson Hole Economic Policy Symposium, Chairman Jerome Powell signaled the first reduction in the benchmark interest rate since March 2020. Although Powell refrained from announcing the time and the extent of the rate cut, Wall Street expects the first cut in the September FOMC meeting following the release of a series of weak economic data, especially, the resilient labor market data.
Economic Data
The monthly survey of manufacturers in New York State for the month of September conducted by the New York Fed came in at 11.5, marking its highest level in 2024. This also reflected the first monthly increase of the index since November 2023. The metric for August was a negative 4.7.
The new orders index climbed to 9.4 in September, marking a multi-year high, while the shipments index rose to 17.9, its highest level in about a year and a half, signaling strong growth in shipments. Firms were more optimistic that conditions would improve in the coming months, though the capital spending index dipped below zero for the first time since 2020.
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Stock Market News for Sep 17, 2024
Wall Street closed mixed on Monday ahead of the Fed’s crucial FOMC meeting this week. Market participants are overwhelmingly expecting the first rate to be initiated in September FOMC meeting. The Dow and the S&P 500 ended in positive territory while the Nasdaq Composite finished in negative zone.
How Did The Benchmarks Perform?
The Dow Jones Industrial Average (DJI) was up 0.6% or 228.30 points to close at 41,622.08, marking its new all-time closing high. Notably, 25 components of the 30-stock index ended in positive territory while 5 in negative zone. The blue-chip index posted a four-day winning run.
The tech-heavy Nasdaq Composite finished at 17,592.13, declining 0.5% due to weak performance by technology giants, especially AI-based semiconductor stocks. The tech-laden index terminated a five-day winning-streak.
The major loser of the tech-laden index was Arm Holdings plc (ARM - Free Report) . The stock price of this technology services company tanked 6.1%. ARM Holdings currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The S&P 500 rose 0.1% to finish at 5,633.09. Wall Street’s benchmark is currently less than 1% below its all-time high recorded in July. The index also registered a six-day winning-streak.
Nine out of 11 broad sectors of the broad-market index ended in positive territory while two in negative zone. The Communication Services Select Sector SPDR (XLC), the Financials Select Sector SPDR (XLF) and the Energy Select Sector SPDR (XLE) advanced 1.1%, 1.3% and 1.1%, respectively.
The fear-gauge CBOE Volatility Index (VIX) was up 3.5% to 17.14. A total of 9.74 billion shares were traded on Monday, lower than the last 20-session average of 10.75 billion. Advancers outnumbered decliners on the NYSE by a 2.74-to-1 ratio. On Nasdaq, a 1.17-to-1 ratio favored advancing issues.
Markets Wait for Crucial Fed Meeting
The Fed will conduct its next FOMC meeting on Sept. 17-18. Market participants are currently riding on high expectations of the beginning of the interest rate cut regime by the Fed in the September FOMC meeting scheduled next week. The existing range of 5.25-5.5% marks a 23-year high level. If the Fed initiates a rate cut, it will be the first one since March 2020, at the onset of COVID-19.
The CME FedWatch tool currently shows a 100% probability of a 25-basis point interest rate cut in September and a 69% chance of a 50-basis-point rate cut. For November, market participants estimate a 100% probability that the total (year-to-date) rate cut will be 50 basis points and a 83.4% probability that the total rate cut will be 75 basis points. Likewise for December, market participants estimate a 100% probability that the total rate cut will be 75 basis points and a 94.3% probability that the total rate cut will be 1% in 2024.
Last month, in his speech at the Fed’s Jackson Hole Economic Policy Symposium, Chairman Jerome Powell signaled the first reduction in the benchmark interest rate since March 2020. Although Powell refrained from announcing the time and the extent of the rate cut, Wall Street expects the first cut in the September FOMC meeting following the release of a series of weak economic data, especially, the resilient labor market data.
Economic Data
The monthly survey of manufacturers in New York State for the month of September conducted by the New York Fed came in at 11.5, marking its highest level in 2024. This also reflected the first monthly increase of the index since November 2023. The metric for August was a negative 4.7.
The new orders index climbed to 9.4 in September, marking a multi-year high, while the shipments index rose to 17.9, its highest level in about a year and a half, signaling strong growth in shipments. Firms were more optimistic that conditions would improve in the coming months, though the capital spending index dipped below zero for the first time since 2020.