Major bond-market gauge cements worst 2-day rout since October as market rethinks path of Fed rate cuts
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A roughly $100 billion bond exchange-traded fund that tracks the Bloomberg U.S. Aggregate index experienced its worst two-day drop since October. U.S. bonds extended a rout sparked by strong economic data and pushback from the Federal Reserve on the potential timing and magnitude of interest-rate cuts this year. The benchmark 10-year Treasury yield rose to 4.163% on Monday, a roughly 30 basis-point jump from the start of February. Fed Chairman Jerome Powell reiterated a need for the central bank to be careful about rate cuts in a “60 Minutes” interview. The iShares Core U.S. Aggregate Bond ETF fell 0.8% on Monday, marking its worst two-day drop since Oct. 3, 2023. The Dow Jones Industrial Average closed 0.7% lower and the S&P 500 index ended down 0.3% on Monday. The ICE BofA Move Index, a “fear” gauge of bond-market volatility, was last pegged at about 113 on Monday. There are concerns that higher interest rates for longer could hurt underwater commercial-real estate assets held by banks.
#BondMarket #FederalReserve #RateCuts
https://www.marketwatch.com/story/major-bond-market-gauge-cements-worst-2-day-rout-since-october-as-market-rethinks-path-of-fed-rate-cuts-3a3daa9a
Stock-market investors fear ‘no-landing’ economy could spell trouble. What’s next.
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Stock investors fear a 'no-landing' economy could spell trouble for the U.S. stock market. The possibility of a 'no landing' scenario, where the economy remains strong while inflation stays on target, has raised concerns among investors. If inflation reaccelerates, the Federal Reserve may be hesitant to cut its policy interest rate, which could spell trouble for stocks. The past week saw strong tech earnings and a blowout jobs report, leading to record highs for U.S. stocks. However, Fed Chair Jerome Powell's comments during the week indicated that the central bank may not start cutting its key interest rate in March. Former Fed vice chairman Roger Ferguson referred to this scenario as the risk of 'no landing.' Traders have adjusted their expectations, with a lower likelihood of a rate cut in March and a higher likelihood in May. The blowout jobs report further eliminates the chance of a rate cut in March. The U.S. economy added 353,000 new jobs in January, exceeding expectations. Earnings reports have also been positive, with 68% of S&P 500 companies beating estimates. However, tech companies' guidance has not been as strong, and concerns around regional banks have resurfaced. New York Community Bancorp's stock triggered a drop in regional bank stocks after posting a surprise loss and signaling challenges in the commercial real estate sector. The Fed's bank term funding program is set to end in March, which has added to the headwinds for regional banks. Investors are advised to go risk-off before May, with a preference for U.S. Treasuries with a tenor of four years or shorter. For stocks, the healthcare, utilities, consumer staples, and energy sectors are favored. Some investors remain optimistic, citing the slowdown in inflation and strong economic data and earnings. In the week ahead, investors will be watching the ISM services sector data, the U.S. trade deficit, and weekly initial jobless benefit claims numbers. Several Fed officials will also speak, providing more clues on the possible trajectory of rate cuts.
#StockMarket #Economy #Inflation #InterestRates #FederalReserve #Investors
https://www.marketwatch.com/story/stock-market-investors-fear-no-landing-economy-could-spell-trouble-whats-next-013329b7
Jobs report for January: U.S. employment soars by 353,000, stunning Wall Street
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The U.S. jobs report for January reveals that employment in the country has surged by 353,000, which has surprised Wall Street. The report is seen as vital to the Federal Reserve's outlook. The data shows a significant increase in employment, indicating a strong job market. This news has stunned Wall Street, as analysts had predicted a slower growth rate. The report's findings will likely impact the Federal Reserve's decision-making regarding interest rates and monetary policy. The surge in employment is a positive sign for the U.S. economy and may contribute to increased consumer spending and economic growth. The report's release has garnered significant attention from investors and economists alike.
#U.s.JobsReport #Employment #WallStreet #FederalReserve #JobMarket #EconomicGrowth
https://www.marketwatch.com/livecoverage/jobs-report-for-january-employment-growth-seen-slowing-in-report-vital-to-fed-outlook
Chevron U.S. Production Sets New Record in 4Q -- Energy Comment
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Chevron's U.S. net production reached a new high in the fourth quarter, primarily due to the acquisition of PDC Energy, which added 266,000 oil-equivalent barrels per day. Internationally, net oil-equivalent production fell 1.4% in the quarter. Chevron's annual worldwide net oil-equivalent production increased to over 3.1 million barrels of oil-equivalent per day, with 14% growth in the United States. In the downstream business, refinery crude oil inputs rose 4% in the U.S., while internationally, refinery crude oil inputs fell 4% due to planned shutdowns. Refined product sales in the U.S. were up 5% from the year-ago period, primarily driven by higher demand for jet fuel. Internationally, refined product sales were flat compared to the fourth quarter of last year.
#Chevron #Production #Oil #Acquisition #PdcEnergy #PermianBasin #Refinery #DownstreamBusiness
https://www.marketwatch.com/story/chevron-u-s-production-sets-new-record-in-4q-energy-comment-ee011f9c
Fed meeting: Dow Jones ends more than 300 points lower after Powell says March rate cut unlikely
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The Dow Jones ended more than 300 points lower after Federal Reserve Chairman Jerome Powell stated that a rate cut in March is unlikely. The Fed's interest-rate decision and Powell's news conference were closely watched by the markets. The meeting took place on January 31, 2024. The market reaction to Powell's comments resulted in a significant drop in the Dow Jones. The article provides live coverage of the Fed meeting and includes information on the impact of Powell's statements on the stock market.
#FedMeeting #DowJones #RateCut #JeromePowell
https://www.marketwatch.com/livecoverage/fed-meeting-s-p-500-futures-slip-as-investors-juggle-megacap-earnings-fomc-decision
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