Daily Market Notes | 5-minute read

July 10, 2024

By Donald Selkin | Chief Market Strategist

DOW: 39,386.28

S&P: 5,498.14

Nasdaq: 18,529.82

10YR T-Note: 4.29%

Bitcoin: 57,869.80

VIX: 12.44

Gold: $2378.73 Crude Oil: $82.70

Prices Current as of 11:45 am

Source: CNBC

40+ Years on

Don Selkin, the creator and innovator of the "Fair Value" numbers, as its Chief Market Strategist on the Newbridge platform has given CNBC and its Predecessor, these numbers every day for the over 40 years - never missing a single day, as well as given the fair value for the Nasdaq 100 futures since their introduction in 1996 and the Dow Jones stock index futures since 1997. Mr. Selkin has also been quoted in several publications including but not limited to Bloomberg News, New York Post, Reuters, and The New York Times. Mr. Selkin's Fair Value numbers are included in the U.S.
Futures Report broadcast on CNBC every day before the market
opens attributing "Newbridge Securities" as the source. In addition, NSC provides to its professionals, their clients and the public access to Don Selkin's more in depth financial market views.

Another day, another same result with the S&P and the Nasdaq grinding to further new record all-time highs while the Dow and Russell 2000 Index of small stocks declined again, and what else is new?

The Dow swung violently in both directions, getting as high as a 150 point gain after being lower by almost 200 points in the morning before finally ending 52 points down to 39,291. The upside attempts were led by the financials such as GS, AXP and JPM at new highs while selling in BA, CAT and CRM were negative.

The S&P stayed quiet, mainly to the upside before ending at a new record of 4 points to 5577. It was led by AAPL at a new high, NVDA, TSLA which has now gone up for 10 straight days and the financials as mentioned above. It was the 36th new high this year.

And why should the Nasdaq be left out of the upside party as it advanced by 25 to 18,429 to a new high of its own led by the three mentioned above while the Russell 2000 Index of small stocks just languished lower by 9 to 2029.

The VIX continued its aimless going nowhere pattern with a slight gain to 12.51 and is showing no indication as to what the near-term direction of stocks is going to be.

Remarks by Federal Reserve Chair Jerome Powell in front of the Senate Banking Committee did little to change the market’s expectations for the timing of a Fed interest rate cut. Powell reiterated that inflation has eased notably in the past two years, though it remains above the central bank’s 2% target. He also noted that there is a risk in the Fed moving to cut interest rates too late or too little, warning either scenario could end up weakening the economy and job market.

Powell’s testimony offered little new guidance on the Fed’s plans for when it might lower interest rates. Traders are still betting that there is a 70% chance that the central bank will cut its main interest rate as soon as September, according to data from CME Group.

Treasury yields rose slightly in the bond market. The yield on the 10-year Treasury note edged up to 4.30% from 4.28% late Monday.

The Fed has remained cautious about making a move on interest rates, holding its benchmark interest rate at its highest level in more than two decades as it waits cautiously for more signals that inflation is still cooling.

Most measures of inflation show that it is easing, though at a much slower pace throughout 2024. The rate is hovering around 3% and continues exerting pressure on consumers, especially those with lower incomes.

In his testimony, Powell noted that “elevated inflation is not the only risk we face.” Cutting rates “too late or too little could unduly weaken economic activity and employment,” he said.

A strong jobs market and consumer spending have been supporting economic growth, though the pace has slowed. Consumer spending has also been weakening as inflation prompts shifts in priorities for many to necessities over discretionary items. Borrowing costs are also higher because of elevated interest rates, adding more pressure on consumers.

Consumer goods company HELE, which makes Osprey and OXO products, sank by 28% after posting first-quarter results that fell far short of forecasts.

Powell is scheduled to testify today before the House Financial Services Committee. His testimony comes ahead of the new inflation updates later this week. (C.P.I. tomorrow and P.P.I. on Friday)

Second-quarter earnings season kicks off this week with the following: yesterday – HELE lower; tonight – WDFC; Thursday – CAG, DAL, PEP; Friday – C, FAST, JPM, WFC, BNY.

Economic reports will see: Thursday – June C.P.I., weekly jobless claims; Friday – June P.P.I., preliminary U. of Michigan Consumer Sentiment Survey.

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