The Dividend Cafe Tuesday - August 5, 2025
Aug 5, 2025
Dive into the latest market analysis, where a notable shift from growth to value stocks is front and center. Discover the mixed economic signals with a slight miss in the ISM Services index yet a strong PMI number. Learn how current Fed policies and interest rates influence foreign investment. Earnings season shows promising growth, especially in AI. Plus, explore the intricacies of market valuations and the potential risks of various investment opportunities. It's an insightful look at the financial landscape!
AI Snips
Chapters
Transcript
Episode notes
Services Sector Near Stagnation
- July's ISM services index slightly missed expectations at 50.1, barely above the expansion mark of 50.
- New orders and employment weakened with prices paid slightly higher, indicating sluggish but still expanding services activity.
Strong PMI Contrasts ISM Services
- The revised PMI, combining manufacturing and services, showed a strong reading of 55.7, rising from 52.09 the prior month.
- This contrasts with the softer ISM services data, indicating uneven sector performance.
Steepening Yield Curve Signals Fed Cut
- The yield curve has steepened due to falling short-term rates, with the 2-year yield down 60 basis points since early 2025.
- Market expects a September Fed rate cut with about 80% probability reflecting easing monetary policy.