Hansen, Mueller Industries director, sells $105,710 in stock
Investing.com - ING expects the Federal Reserve to cut interest rates at its upcoming meeting next week, followed by another 25 basis point reduction in December, according to a recent analyst note. The market appears to be pricing in this outlook, with the S&P 500 ETF (SPY) trading near its 52-week high of $674, showing a robust 14.35% year-to-date return. InvestingPro data reveals the index has maintained remarkably low price volatility throughout this period.
The bank’s analysis points to lower-than-expected tariff impacts, noting that July and August customs revenue and goods import figures show a realized tariff rate of approximately 10%, significantly below the 18% rate estimated based on announced country and sector tariffs. September customs revenue showed no acceleration in collection rates. This economic stability is reflected in the market’s current P/E ratio of 14.65, as tracked by InvestingPro.
ING suggests this discrepancy may reflect either strong substitution effects—with US companies switching to lower-tariff countries for product sourcing—or temporary collection problems due to resource constraints. The result has been less inflationary pressure than anticipated, with core inflation rising a "relatively benign" 0.2% month-on-month in September.
Employment data, though limited by the government shutdown, shows concerning trends from alternative sources. The ADP private payrolls series reported net job losses in three of the past four months, while ISM data suggests employment contraction. Household sentiment has deteriorated, with more than 50% of households expecting unemployment to rise over the next 12 months.
Business surveys "aren’t painting a particularly upbeat picture of the state of the economy," ING notes, reinforcing their expectation for Fed rate cuts both in November and December.
In other recent news, Deutsche Bank has revised its forecast for third-quarter earnings growth for the S&P 500 to 10.7% year-over-year, an increase from the 9.3% growth seen in the previous quarter. The bank attributes this adjustment to a favorable macroeconomic environment and strong U.S. economic data, with GDP growth projected at 2.8%. Meanwhile, Wells Fargo anticipates the Federal Reserve will implement a 25 basis point interest rate cut at the upcoming October 29 Federal Open Market Committee meeting. Additionally, Wells Fargo maintains its forecast for two more rate cuts by the end of 2025. In the realm of technology, Goldman Sachs has addressed concerns about the sustainability of AI investment, asserting that the current levels are sustainable and beneficial due to productivity gains. Lastly, amidst ongoing trade tensions, President Trump has commented on the complex relationship with China, highlighting the need for caution despite having a good relationship with President Xi.
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