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The CML Close - Stock rise sharply, Fed raises rates, pending home sales plummet, Senate passed chip bill - 07-27-2022




Date Published:



Markets
Stocks rose sharply following declines yesterday after the Federal reserve hiked its key interest rate 0.75% for the second meeting in a row.

Pending home sales plummeted and the US Senate passed a bill to boost chip manufacturing and compete with China. 

SPX 4,023.61 +102.56 (+2.62%)
NASD 12,032.42 +469.85 (+4.06%)
DJIA 32,197.59 +436.05 (+1.37%)
R2K 1,848.34 +43.09 (+2.39%)
VIX 23.24 -1.45 (-5.87%)
Oil 98.20 +3.22 (+3.39%)

• Stocks rocked higher.

• Chairman Powell gave no absolute guidance for rate hikes in the next FOMC meeting in September while acknowledging slowing economic growth and inflation.

• Pending home sales crumbled.

• Russia continues its war games with oil and gas.

• Initial GDP numbers for Q2 are due out tomorrow - numbers which tend to be revised many times before being finalized. 

Headlines of the Day
Fed hikes interest rates by 0.75 percentage point for second consecutive time to fight inflation
The Federal Reserve on Wednesday enacted its second consecutive 0.75 percentage point interest rate increase, taking its benchmark rate to a range of 2.25%-2.5%.

U.S. Senate passes bill to boost chip manufacturing, compete with China
The U.S. Senate on Wednesday passed sweeping legislation to subsidize the domestic semiconductor industry, hoping to boost companies as they compete with China.

Shoppers Spend Without Splurging, Clouding US Recession Call
Walmart squeeze shows retail dynamics are changing post-Covid. Shift comes as Fed, investors attempt to gauge economy’s path.

Russian Gas Cuts Risk Reviving Old EU Divisions This Winter
Southern capitals cool to excessive efforts to help Germany. Bloc confident that solidarity will prevail against Putin.

IMF Cuts World GDP Outlook a Third Time as Inflation, Rates Jump
Outlook risks ‘overwhelmingly tilted to downside,’ fund says. World may soon be teetering on recession edge, Gourinchas says.

Economic Data Results for 7-27-2022
FOMC Interest Rate Decision
The Federal Reserve raised the target range for the fed funds rate by 75bps to 2.25%-2.5% during its July 2022 meeting, the fourth consecutive rate hike, and pushing borrowing costs to the highest level since 2019, matching market forecasts.

United States Pending Home Sales YoY
Pending Home Sales in the United States decreased 20 percent year-on-year in June of 2022, the biggest decline since a record 33.1 percent slump in April of 2020.

United States Wholesale Inventories
Wholesale inventories in the US went up 1.9 percent month-over-month to $896.0 billion in June of 2022, the same pace as in May.

United States Durable Goods Orders
New orders for US-made capital goods rose 1.9 percent from a month earlier in June of 2022, the most since January and the fourth consecutive monthly increase. Figures beat market forecasts for a 0.5 percent decrease.

Economic Data Due Tomorrow on 7-28-2022
GDP Growth Rate QoQ Adv Q2

Jobless Claims 4-week Average 23/JUL

Initial Jobless Claims 23/JUL

United States Real Consumer Spending QoQ



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