Weekly Newsletter 9/6/24

Hello Friends,

Good day to everyone and thanks for checking in to our weekly message. Lots going on here so lets get right down to it. US equities lower in Friday morning trading, near worst levels. S&P down for the fourth straight session and on track to finish lower for the week after three straight weekly gains. Notable drag today from big tech (TSLA-US , NVDA-US big decliners); equal-weight S&P holding up better than the official index. Other laggards include semis/semicaps, networking/communications, apparel retail, hospitals, biotech, copper/aluminum, and China tech. Relative outperformers include homebuilders, airlines, regional banks, credit cards, machinery, building products, media, energy, travel/tourism, food, and beverages. Treasuries firmer; curve steepening has pushed 2/10 spread back into positive territory. Dollar index up 0.1%. Gold down 0.2%. WTI crude down 1.2%, heading for its worst week since February and the eighth weekly decline of the past nine weeks.

Market under pressure this morning following today's August payrolls report, the week's crucial release. Headline came in a bit weaker than consensus and prior months revised lower (again), but little movement in unemployment rate which has been a big focus of commentary. Soft-landing scenario still seems to be supported by the data, but report ultimately did not itself provide much additional clarity between a 25bp or 50bp rate cut in September (market pricing sees as a toss-up). This debate has been the big theme this week on the back of some pickup in growth worries (bad news is bad news, Fed behind the curve), front-running of negative seasonality (2H September worst two-week period of the year), AI scrutiny (some more today with AVGO-US missing on semi sales), systematic unwinding, corporate supply and yen strength.

August nonfarm payrolls up 142K vs consensus for ~165K in August (though prior two months revised down by a combined 86K jobs). Closely watched unemployment rate ticked down to 4.2% from 4.3%, though very little changed on unrounded basis. Average hourly earnings up 0.3% m/m, as expected. Results come after previews flagged risks in both directions amid the slower pace of job creation and following some of the temporary issues that seemed to weigh on August. Overnight Fedspeak continued to show close attention on labor-market health; Fed's Williams today said Fed policy has been effective in stabilizing inflation and it is now appropriate to lower rates. Waller also scheduled to speak later this morning.

Finally the football season officially got underway last night. The spectacle of pro football is alive and well. Have a great weekend everyone. Stay safe.

Fun facts about this day in history.

1522 Magellan’s expedition circumnavigates globe.

1901 President William McKinley is shot.

1995 Baltimore Orioles shortstop Cal Ripken Jr. breaks record for consecutive games played.

1997 Some 2.5 billion TV viewers watch Princess Diana’s funeral.

Our weekly resources link is attached.

Pasquale

https://www.raymondjames.com/evangelista/resources

Mediocre people don't like high achievers, and high achievers don't like mediocre people.

Nick Saban

Thank you,

Pasquale Evangelista
Sr. Vice President, Investments
Raymond James & Associates, Inc.
1421 Pine Ridge Rd. Suite 300
Naples, FL 34109
(239) 513-6528 Direct - (800) 843-2025 -Toll Free - (239) 938-4078 Cell - (239) 596-5474 Fax
Pasquale.Evangelista@RaymondJames.com
www.raymondjames.com/evangelista

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Consumer Sentiment is a consumer confidence index published monthly by the University of Michigan. The index is normalized to have a value of 100 in the first quarter of 1966. Each month at least 500 telephone interviews are reconducted of a contiguous United States sample.
Personal Consumption Expenditures Price Index (PCE): The PCE is a measure of the prices that people living in the United States, or those buying on their behalf, pay for goods and services. The change in the PCE price index is known for capturing inflation (or deflation) across a wide range of consumer expenses and reflecting changes in consumer behavior.
The U.S. Dollar Index is an index of the value of the United States dollar relative to a basket of foreign currencies, often referred to as a basket of U.S. trade partners' currencies. The Index goes up when the U.S. dollar gains "strength" when compared to other currencies. Source: FactSet, data as of 6/16/2023
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