Wednesday's Markets Update (August 21, 2024)

22 Aug 2024 by rate3

On Wednesday stock growth slowed as prices edged toward a key resistance level and investors weighed economic data and expectations for Fed rate cuts. The BLS revised down job growth numbers, adding to concerns about a softer labor market. The Fed is likely to cut rates in September and potentially more this year. Globally, oil dropped to six-month lows due to a weakening economy, while gold reached a new ATH on the growing probability of rate cuts around the world. BTC and ETH attempted to break out of a descending wedge formation but remained constrained at roughly the same monthly levels.

Details

Recent data shows job growth was weaker than previously reported with 818K fewer jobs added, suggesting a cooling job market. July's job numbers were also disappointing, further indicating a slowdown in the economy. 1Y trend: "Down" (BLS)
The average interest rate for 30-year fixed-rate mortgages fell to 6.50%, the lowest in over a year. This marks a 32-basis point drop in four weeks and an 81-basis point decline compared to a year ago. 1Y trend: "Down" (MBA)
World Markets

Argentina's economy shrank in June, with sharp declines in utilities, construction, and manufacturing. Growth slowed in other sectors. This marks the second-worst contraction of the year. 1Y trend: "Down" (Indec)
Japan's exports rose to a 7-month high in July, driven by cars, machinery, and electronics. Growth accelerated to 10.3%, but missed forecasts. Exports to major markets like China and the US increased, while those to Thailand, Germany, and Russia declined. 1Y trend: "Up" (MOF)
Currencies

The dollar fell to its lowest point in 2024 after the Fed hinted at a possible rate cut. Weaker US job data and a stronger Euro, Pound, and Yen contributed to the dollar's decline. 1Y trend: "Side"
Commodities

Oil prices fell as investors reacted to Fed rate cut expectations and weaker-than-expected job growth. Lower oil inventories couldn't offset concerns about China's economy and Middle East tensions. 1Y trend: "Side"
Gold prices rose as central banks eased monetary policies. The downward revision of nonfarm payrolls reinforced concerns about the US labor market and strengthened the case for aggressive rate cuts. Central banks in Sweden, China, the Eurozone, and the UK have all lowered rates. 1Y trend: "Up"