Hey there, readers!
Today, let's dive into the exciting world of stocks and interest rates. 📈💰
As markets continue to adjust to the possibility of a halt in interest rates, stocks are also feeling the impact. Yields tumbled on Tuesday following dovish comments from Federal Reserve officials, including Governor Christopher Waller endorsing an outright 'pause' on rates. The benchmark ten-year Treasury yield settled at 4.335%, about 0.05 percentage point lower than Monday.
While the U.S. dollar, often reflecting interest-rate expectations, was on track to close at its lowest value in months, stocks didn't see much movement. The S&P 500 added a mere 0.1%, the Nasdaq Composite inched forward by 0.3%, and the Dow Jones Industrial Average gained 83 points, or 0.2%. It seems that stocks may have already made their big move.
Both the broad-market S&P and the tech-heavy Nasdaq are on track for their best months since mid-2022. However, the question arises: have stocks gotten ahead of themselves when it comes to rates and the economy? The market is still watching closely for potential risks, such as a drop in home prices.
Speaking of home prices, the pandemic set off a housing buying frenzy, but it seems that the frenzy has passed. Despite that, high home prices have remained stubbornly high. S&P Dow Jones Indices reported that the S&P CoreLogic Case-Shiller National Home Price Index hit a new record in September. The main reason for this is the unwillingness of current homeowners, who have mortgages at much lower rates, to move. This has severely limited the supply of homes and kept prices elevated.
Now, let's shift our focus to the tech world. Microsoft finds itself in a delicate situation with OpenAI. While the tech giant needs to solidify its relationship with the high-profile startup, it also wants to show that it can chart its own course in the field of artificial intelligence. Microsoft is already spending a significant amount on research and development, but it might find it cheaper in the long run to control more of its own destiny.
That's all for today, folks! Stay tuned for more exciting updates in the world of finance and technology. 🌟💼
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