I hope everyone enjoyed the nice weather this past weekend. We have one official week left of summer with the first day of fall being the 22nd (I know this well because it “falls” on my birthday)!
Major US stock benchmarks hit fresh all-time highs last week with optimism of a Fed rate cut this week and strong AI momentum around Oracle’s future revenue. Last week’s in-line inflation data coupled with continued signs of a cooling jobs market, likely secured a .25% rate cut this Wednesday. Investors are currently pricing ~3 cuts between now and the end of the year. What I find interesting is there is roughly $7 trillion in money market funds that as rates begin to come down, I think will start slowly rolling into equities. Should we see near-term pullbacks of significance, this migration from cash to stocks could accelerate as investors look to “buy the dip”. How Fed Chair Powell positions what is likely a cut this Wednesday in context to the rest of the year, will be watched closely by investors. Page two of the attached MSRS gives our views on the different rate outcomes. I still anticipate this market carrying momentum with additional broadening out into more quality value names. Please continue to reach out with questions.
Attached, please find this week’s Market Strategy Radar Screen Report from John Stoltzfus, Chief Investment Strategist of Oppenheimer Asset Management.
Have a great week!