Last Updated: 5:01 PM EST
Stocks finished today’s trading session in the green as the S&P 500 (SPX) and the Dow Jones Industrial Average (DJIA) gained 0.27% and 0.65%, respectively. Earlier today, Wells Fargo said it expects the Federal Reserve to make a smaller, 25-basis-point rate cut at its November 7 meeting after its 50-point cut in September.
According to Wells Fargo’s Chief Economist, Jay Bryson, strong economic data shows that the economy holding up better than expected. In fact, Bryson thinks the Fed is more likely to pause than make another big cut.
Separately, Wells Fargo also predicts holiday sales will only rise by 3.3% this year, lower than last year’s growth and the long-term average of 4.3%. Shoppers are tightening their budgets as they feel the impact of inflation and are spending more steadily throughout the year rather than splurging during the holidays.
Senior Economist Tim Quinlan points out that consumer spending power now depends more on income growth, as pandemic-driven extra cash has faded, and sales are growing at the slowest pace in seven years. However, it is worth mentioning that with shopping spread out year-round, Wells Fargo doesn’t see a slower holiday season as a red flag for 2025 spending. Quinlan explains that while holiday sales may be softer, this shift in habits could actually help keep consumer spending steady over time.
First Published: 4:24 AM EST
U.S. stock futures rallied on Monday morning, signaling a positive start to the trading week. Investors are eagerly awaiting a busy week of third-quarter earnings from major tech giants. Futures on the Nasdaq 100 (NDX), the S&P 500 (SPX), and the Dow Jones Industrial Average (DJIA) were up 0.68%, 0.53%, and 0.47%, respectively, at 4:08 a.m. EST, October 28.
It must be noted that geopolitical tensions eased over the weekend. While Israel’s retaliatory strikes on Iran on Saturday raised concerns, market fears were eased as oil and nuclear facilities were not targeted.
Interestingly, the upcoming week is packed with key events that could impact the market. The third-quarter earnings season will reach its peak, with several tech giants, including Alphabet (GOOGL), Microsoft (MSFT), Meta Platforms (META), Amazon (AMZN), and Apple (AAPL), scheduled to report their results. Today, ON Semiconductor (ON), Ford (F), and Waste Management (WM) will be releasing their results.
Additionally, investors will closely monitor key economic indicators, such as September’s Core Personal Consumption Expenditures report and third-quarter GDP growth estimate. Moreover, October’s Nonfarm Payrolls, Unemployment Rate, and ISM Manufacturing Purchasing Managers Index will be made public this week. These economic releases will provide insights into the health of the U.S. economy and could influence market sentiment.
Meanwhile, the U.S. 10-year treasury yield is up at the time of writing, floating near 4.282%. At the same time, WTI crude oil futures trended lower, hovering near $68.71 per barrel as of the last check.
Elsewhere, European markets opened mixed today as investors evaluated the current geopolitical situation in the Middle East.
Asia-Pacific Markets Traded Higher on Monday
Asia-Pacific indices traded higher today, with Japanese stocks witnessing the most gains. The upside came after the yen weakened to a three-month low against the dollar, signaling benefits for the country’s export-oriented economy.
Hong Kong’s Hang Seng index was up 0.2%. Similarly, China’s Shanghai Composite and Shenzhen Component indices gained 0.68% and 0.62%, respectively. Further, Japan’s Nikkei and Topix indices finished higher by 1.82% and 1.51%, respectively.
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