Traders work on the trading floor of the New York Stock Exchange (NYSE) on September 19, 2024 in New York City, United States.
Brendan McDermid | Reuters
This report comes from today's CNBC Daily Open, our international markets newsletter. CNBC Daily Open keeps investors updated on everything they need to know, no matter where they are. Like what you see? You can subscribe here.
What you need to know today
Dow Jones rises, other indexes fall
US market Friday was mixed. this Dow Jones Industrial Average Rally hits new highs, but S&P 500 Index and Nasdaq Index dropped. The pan-European Stoxx 600 index fell 1.42%, dragged down by a 3.6% decline in auto stocks. After cutting 2024 guidance, Benz It fell more than 8%, but pared the loss to 1.6% by the close.
Qualcomm acquires Intel?
Qualcomm Recently contacted Intel for possible acquisitions. It was unclear whether negotiations were continuing or the terms of a possible deal, the sources said. Considering Intel's market capitalization of more than $90 billion, the deal, if successful, would be one of the largest technology acquisitions in history. Intel's business has struggled in recent years.
Interest rate cut considerations
Federal Reserve Governor Christopher Waller said on Friday that he voted for a half-percentage point rate cut because “inflation is slowing much faster than he thought.” Michelle Bowman, who voted for a quarter-point rate cut, said in a statement that “the committee's larger policy action could be interpreted as a premature declaration of victory on inflation.”
“As long as needed”
boeing company The workers' strike enters its second week and may continue for some time. One worker, who spoke on condition of anonymity, said he had been saving money for months and was “holding on as long as I could” to get a better labor contract from Boeing. Aerospace analyst Ron Epstein said the strike is costing Boeing about $50 million a day.
(PRO) Test Power
Last week, stocks rose on a larger-than-usual interest rate cut. The Dow Jones Industrial Average and S&P 500 hit new highs. Whether they can sustain that momentum is another matter. CNBC Pro's Sarah Min writes that a slew of data this week, such as Friday's personal consumption expenditures index, will test stocks.
bottom line
The market seemed to acknowledge that the Fed’s sharp rate cut last week was because The central bank wants to keep the job market healthy.
On Friday, some doubts seemed to resurface.
fedex The company's shares plunged 15.2% after reporting first-quarter profit that missed expectations. This isn't just bad news for the company and its investors.
The trucking company is seen as an economic bellwether. The higher the overall demand, the more transportation services are needed. So when FedEx misses revenue estimates, one likely conclusion is that the economy is not performing as well as expected.
Some analysts are also increasingly concerned about economic and market conditions.
Nancy Lazar, chief global economist at Piper Sandler, pointed out that the current easing cycle echoes what happened in 2001 and 2007, when the Fed's first interest rate cut was also half a percentage point. But the first deep cuts couldn't avert the recession and global financial crisis of the early 2000s.
“On average, it takes 10 quarters after a rate hike for a recession to begin,” Lazar wrote. “This is the 10th quarter. Given the size of the rate hike and the shrinking of the Fed's balance sheet, the unemployment rate is likely to Reach 6%.
In financial markets, financial firm BTIG believes a pullback is possible. But Chief Market Technician Jonathan Krinsky said he was optimistic that “the weakness may be milder than we initially thought.”
Indeed, despite Standard & Poor's Down 0.19% Nasdaq Down 0.36% on Friday Dow Chemical rose 0.09%, hitting a new closing high. All three indexes ended the week in the green.
Last week's burst of optimism was largely driven by anticipation and celebration of a rate cut by the Federal Reserve. This week the market will be focused on upcoming hard data such as PMI, consumer confidence and preliminary indicators such as the PCE report. They will provide more clues as to whether the cuts are a recalibration or a reaction.
–CNBC’s Alex Harring, Hakyung Kim and Brian Evans contributed to this article.