The producer price index increased 0.5% for September, against the Dow Jones estimate for a 0.3% rise.
Excluding food and energy, core PPI was up 0.3%, versus the forecast for 0.2%.
Inflation pressures came primarily from final demand goods, which surged 0.9% on the month, while services increased 0.3%.

Former FTX CEO Sam Bankman Fried’s lawyers have requested for a pre-trial release because the internet sucks in jail.

A few notable earnings reports will drop after markets close in New York, including software giant Salesforce, cybersecurity firm Crowdstrike and retailer Costco Wholesale.

Calendar
Aug. 25: Fed Chair Powell speaks at Jackson Hole Summit, and final August University of Michigan Consumer Sentiment.

Aug. 29: June S&P Case-Schiller home price index, August Consumer Confidence Index, and expected earnings from Best Buy Co. (BBY), Big Lots (BIG), Box, Inc. (BOX), and HP Inc. (HPQ).

Aug. 30: August ADP employment and revised Q2 Gross Domestic Product.

Aug. 31: Weekly Initial Jobless Claims, July Personal Consumption Expenditures (PCE) price index, July Personal Income and Spending, August Chicago Purchasing Managers Index (PMI), and expected earnings from Dell Technologies (DELL), Dollar General (DG), Hormel Foods (HRL), Lululemon Athletica (LULU), and UBS AG (UBS).

Sept. 1: August Employment Report, Construction Spending, and the Institute for Supply Management Manufacturing Index.

Investors pulled more than $1.8 billion from the iShares 20+ Year Treasury Bond Fund (TLT) last week. This mass withdrawal ranks as the largest migration from the fund since March 2020. Investors’ sentiment has shifted away from long-term Treasurys as they expect the Fed to hold rates higher for longer. Yields on long-term U.S. debt have risen significantly as a result, impacting demand for the recent 30-year Treasury auction and prompting investors to reevaluate their positions in TLT.

Hope someone here lives in Hollis Illinois.

Federal Reserve Bank of Philadelphia President Patrick Harker expects rates to remain steady. He believes we may be at the point where we can let the central bank’s monetary policy do its job, though he doesn’t expect rates cuts anytime soon. The Fed raised rates again in July after “pausing” in June when it was comfortable with easing economic activity. The economy’s slowdown is expected to continue, and Harker forecasts core inflation to reach the Fed’s 2% target in 2025.

U.S. trade deficit shrinks for first time in two years – Recent data from the Commerce Department shows that the U.S. trade deficit fell to a three-month low of $65.5 billion in June. This came in below analyst expectations of $65 billion and marks the lowest level since 2021. Shifting consumer spending has led to decreased demand for foreign goods and reduced imports. Overall, Americans are more cautious with their money, though they are also spending more on services rather than goods.

After decades of being the top U.S. importer, China has finally fallen below Mexico and Canada. This shift in U.S. imports reflects the changing dynamics of global trade and can be attributed to several factors, including differences in trade policies and efforts to diversify supply chains. The strained relationship between the U.S. and China has prompted the U.S. to explore alternative sourcing options and mitigate risks in the face of geopolitical uncertainties.

Another week of important earnings reports kicks into high gear today with a wide array of companies reporting. Some notable names include AMD (AMD), Caterpillar (CAT), JetBlue (JBLU), Starbucks (SBUX), Uber (UBER), Merck (MRK), and Pfizer (PFE). These reports will provide insights into various sectors such as semiconductor chips, automotive, aviation, pharmaceuticals, coffee, and technology. With approximately 170 S&P 500 companies reporting their results this week

From Stansberry

will look like after the rebalancing…

Among the most affected companies are Nvidia (NVDA) and Microsoft (MSFT), both of which will see their weights decrease by approximately 3 percentage points. The redistributed weight will be allocated to smaller caps within the index.

The rebalancing will take effect before the market opens on Monday, July 24, and it’s expected to have implications for both passive and active mutual funds benchmarked to the Nasdaq 100 Index. According to analysts at EPFR Global, approximately $251 billion in assets under management from passive mutual funds and exchange-traded funds are tied to the index.

Rebalancing events, especially when executed by passive funds, can create some level of market churn. However, the details of the rebalancing have been known since Nasdaq’s announcement on July 10. So the trading activity that has taken place since could lessen the chances of significant volatility.

In fact, during the previous week, the top seven Nasdaq 100 stocks outperformed the index, suggesting that traders and investors may have already factored in the rebalancing.

Also, when you look at previous special rebalances, it becomes clear that they tend to be uneventful in the long run.

For instance, a special rebalancing occurred in 2011 when Apple’s (AAPL) weight in the index reached an uncomfortable 20%. Despite the reallocation of a significant portion of Apple’s weight to Microsoft, there was no lasting effect on share prices. This precedent suggests that next week’s rebalancing is unlikely to have a profound impact on the overall market.

While events like these may cause some short-term market churn, history suggests that the effects from rebalancing tend to be temporary. But it’s still crucial for investors to stay informed on events like these and keep a closer eye on your portfolio..

Calendar
July 21: Expected earnings from American Express (AXP), AutoNation (AN), and Regions Financial (RF)

July 24: Expected earnings from Domino’s Pizza (DPZ) and Whirlpool (WHR)

July 25: July Consumer Confidence and expected earnings from Alaska Air (ALK), Archer Daniels (ADM), Biogen (BIIB), Dow (DOW), Alphabet (GOOGL), General Electric (GE), General Motors (GM), Kimberly-Clark (KMB), Verizon (VZ), Microsoft (MSFT), and Visa (V)

July 26: FOMC rate decision, June New Home Sales, and expected earnings from AT&T (T), Boeing (BA), Coca-Cola (KO), Union Pacific (UNP), Chipotle (CMG), and Meta Platforms (META)

July 27: Q2 Gross Domestic Product (GDP) first estimate, June Pending Home Sales, June Durable Orders, and expected earnings from AbbVie (ABBV), Baxter (BAX), Bristol-Myers (BMY), Honeywell (HON), McDonald’s (MCD), Ford (F), and Roku (ROKU)

Despite the market’s reaction to Tesla and Netflix, earnings season is surpassing analysts’ pre-quarter estimates, though the bar was low and it’s still very early. More than 80% of S&P 500 companies reporting through Wednesday beat Wall Street’s earnings per share (EPS) estimates, compared with the 74% average over the last 10 years.

The Nasdaq 100 index is set to adjust the weighting of its 100 components, with the “magnificent seven” stocks Microsoft (MSFT), Apple, Nvidia (NVDA), Tesla (TSLA), Google parent Alphabet (GOOGL), Meta Platforms (META) and Amazon.com (AMZN) currently accounting for more than half the index’s weight.

The Nasdaq 100 special rebalance will take place before the market open on Monday, July 24, to “address overconcentration in the index by redistributing the weights.”

The weighting changes will be announced on Friday, July 14. No stocks will be added or removed.

From Venture Capitalist