On today's episode of Catalysts, Hosts Seana Smith and Madison Mills break down some of the trading day's biggest stories, from the global market sell-off to...
break down some of the trading day's biggest stories, from the global market sell-off to some of the latest earnings reports .there's not much other evidence that points to a recession
A I rally a sea of men, the magnificent seven down 20% from its July 10 P. We talk about whether the sector is a falling knife or a buying opportunity. After recession, fears plunged the markets into that three day route, weaker than expected jobs, data pointing to concerns over maybe cracks in the labor market and that was enough to send jitters throughout global markets.We want to bring in Thorsten Slack.So let me put that question right to you when you take a look at maybe the market's reaction to that weaker than expected labor uh data print that we got out on Friday morning.
But if this market sell off that we are seeing right now is in part driven by the unwind that we are currently seen in the A I rally.And I do think that exactly that A I stocks are going down for two reasons, the party going down because valuations got so stretched and earnings and earnings expectations were simply inconsistent with where valuations were.
Well, there brought up a great point and then my question is how ultimately should the fed then be reading into some of that volatility that we have seen when you take a look at that three day sell off.And I'm taking a look at that from futures right now, 75% of traders pricing in a 50 basis point cut at the September meeting.Yeah, I do think that markets are pricing in too many cuts.
You still have a number of tail winds in particular to higher income consumers where you are seeing still strong gains from stock prices going up from home prices going up. So that's all support for the consumer and that's all support for exactly the view that we are not seeing the economy spiraling into a recession.
The jolts data for job cuts and layoffs is also suggesting that there's not any layoffs where the whole reason why the unemployment went up is likely because of an increase in labor supply because of an increase in immigration. So that's why the discussion in market should be, is the data last Friday on the employment side and unemployment?And now we'll get data that shows like we got ISM services yesterday that things are actually not that bad.
So it's not just a straight line down, then we're done, you know, they tend to be three waves or five waves and in the middle of that, you get these relief rallies.A little bit of short covering which creates a rally, which is probably what we're now. Uh If you, if you're nimble, but really lighten up if you're a lot, if you're sort of multi month investor, it all depends on your time frame.What is it a very confusing time for a lot of investors at home trying to figure out what moves to make in their portfolio?We keep right here on Yahoo Finance coming up on catalyst Lucid shares moving higher looking again of just about 3.5% after $1.5 billion cash infusion from a top shareholder.
Yeah, it's interesting because last quarter, there were concerns about liquidity with lucid and of course, today, that's not a concern given this $1.5 billion cash infusion that they are getting from the Saudis. But Taco Bell reported same store sales growth still remains the standout here within this print matty.
But the $7 meal that I also had, had heard of, I shouldn't brand it as the value because that's obviously a competing retailers name having said that though. And essentially what that means is that Apple is able to or required to use Google as its uh default search engine in safari in Siri uh in spotlight search.
And so, you know, if all of this goes forward, if they manage to uh or don't manage to uh win any appeal, uh If these agreements are kind of null and void, we'll have to see where this goes.Uh Do you wanna use duck duck go or do you wanna stick with Google?And so, you know, all of this is kind of uh an interesting discussion because uh according to the, the judge, they are in violation of antitrust laws, I I use different products all the time and I still go back to Google.
Yeah, I mean for, for Apple, yeah, I mean, it's, you know, I think the important thing to point out is that services is its fastest growing business, right? What does it mean for your asset classes and your investment in the all asset we're going to discuss exactly that when we come back, take a look at Cryptocurrency, specifically Bitcoin, moving into the upside here up nearly 7%.
Yeah, Shana and that quarterly dividend that has been maintained part of the reason why that stock is up right now because Sar Arano said that it will maintain its $31 billion in dividend for the second quarter. We're gonna unpack what is next for the big, the big tech trade coming up next zero in on the magnificent seven because the basket of tech stocks lost $652 billion in market cap just on Monday alone.If you take a look at a video on your screen that is up nearly 4.5% on the day.
Um but I think, you know, moving forward, we, we do want to actually have a sort of long quality bias and, you know, think this sort of low quality pockets like small caps relative to large cap growth in tech, um could actually continue to underperform in the near term max.We are seeing some of that buying activity today.
Now something to note and, and, and the real common denominator here is that when that model in particular looks back to history, typically, when you move into a fed cut cycle, it's, it's usually accompanied by a recession, um, you know, several months after, so that our work, as I noted, right, that's going to be key over the, you know, the coming weeks and months in terms of the data coming through CP I next week.
Since you bring it up, we saw it basically tripling overnight here, but we didn't see a lot of stocks hitting 52 week lows, especially as we opened up this morning.And, and that goes back to kind of what I alluded to before, you know, the the move yesterday was clearly dislocated from reality, right?
And we do think there's there's room for normalization and we're obviously seeing that in the price action today with investors using this as a sort of buy the dip um uh opportunity.Taking a look at the major averages just about an hour and 15 minutes into the trading day.You have the S and P up about 1.5%.Now the two are expected to appear together later today at a campaign rally in Philadelphia for more on this selection.But uh Kamala Harris decided otherwise.
I mean, the, uh, what JD Vance is trying to say is Josh Shapiro, the governor of Pennsylvania, he's Jewish and he's staunchly pro Israel. And I think, you know, I have been saying this a lot lately and I, I do realize that it is not the sexiest talking point, but we need stability to have prosperity. It's only a couple of weeks old, but I already it feels like her agenda is about creating growth and opportunity for the middle class.Because I was gonna say she hasn't necessarily gone easy on the tech industry.
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