OP Wire: Friday Market Recap and Updates
US Stock Futures Edge Lower After Jumbo Fed Rate Cut
US stock futures dipped slightly on Friday morning, following record highs hit on Thursday after the Federal Reserveannounced a 50-basis point rate cut, kicking off a new easing cycle. By 03:19 ET, Dow futures were down 32 points (-0.1%), S&P 500 futures dropped 10 points (-0.2%), and Nasdaq 100 futures slid 49 points (-0.2%).
On Thursday, major indices surged on the news, with the S&P 500 climbing 1.7%, the Nasdaq Composite jumping 2.5%, and the Dow Jones Industrial Average advancing 1.3%. This rally was fueled by the Fed’s aggressive rate cut and data showing that weekly jobless claims hit a four-month low, easing fears of an economic slowdown while keeping inflation in check. Despite the excitement, analysts at Vital Knowledge cautioned that the favorable environment for stocks could shift, depending on upcoming economic data and corporate performance.
Bank of Japan and PBOC in Focus
In Asia, the Bank of Japan (BoJ) left interest rates unchanged, keeping its short-term rate at 0.25%. The BoJ also upgraded its outlook for consumer spending, reflecting optimism for moderate economic growth. However, the central bank flagged uncertainties surrounding Japan’s economy, especially with ongoing volatility in currency markets.
Meanwhile, in China, the People’s Bank of China (PBOC) kept its key loan prime rate (LPR) steady, with the one-year LPR remaining at 3.35% and the five-year LPR at 3.85%. Despite recent weak economic data, further rate cuts are expected in the near future as the PBOC looks to stimulate growth.
Nike CEO to Step Down
Shares of Nike saw a boost in extended trading hours following the announcement that CEO John Donahoe will step down next month. He will be replaced by Elliott Hill, a seasoned Nike veteran, on October 14. The move comes amid declining market share for Nike, with competitors like On and Hoka gaining ground. The company has faced challenges, with a 20% drop in stock price following a sales warning in June.
FedEx Slashes Guidance
FedEx also made headlines as the company cut its full-year guidance, reporting weaker-than-expected earnings for its fiscal first quarter. Adjusted earnings per share (EPS) came in at $3.60 on revenue of $21.6 billion, falling short of analyst expectations. FedEx has now narrowed its EPS outlook for fiscal 2025 to a range of $20.00 to $21.00, down from previous estimates. Margins in the company’s core Federal Express segment also took a hit, shrinking to 5.2% from 7.1% last year.
Crude Oil Set for Second Straight Weekly Gain
Oil prices edged lower in Friday’s early trade, but both Brent and WTI crude are on track for a second consecutive weekly gain. Brent crude dropped 0.4% to $74.60 per barrel, while WTI fell 0.3% to $70.93. A large US crude inventory draw reported earlier this week helped support prices, although concerns about weakening demand from top importer China remain.
Hey OP… it’s Friday!
Catch you all in the chat later with today’s upgrades and downgrades. Also, don’t forget, today’s OP Lotto is at $47 million, and I’ll post your tickets after the bell. Let’s close out the week strong!
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