Squawk on the Street
Wrapping Up August Markets, PCE Inflation Watch, Big Spotlight on AI 8/30/24
Aug 30, 2024
Wharton Professor Jeremy Siegel, a renowned expert in finance and economics, joins the discussion on the final trading day of August. They dive into the implications of steady PCE inflation data and the potential for a Fed rate cut. The conversation shifts to the booming AI sector, detailing significant moves by Dell, Marvell, Apple, and Nvidia, particularly their talks regarding OpenAI. Finally, they analyze August's market winners and losers, highlighting trends in tech and retail amidst a recovering market.
41:28
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Quick takeaways
- The stable PCE inflation data suggests a potential Federal Reserve rate cut, significantly altering market expectations for future monetary policy.
- Major tech companies like Apple and Nvidia are heavily investing in AI, signaling its crucial role in driving future economic growth and innovation.
Deep dives
Insights on Inflation and Federal Reserve Actions
Recent data indicates that inflation is stabilizing, with the Personal Consumption Expenditures (PCE) report showing a 0.2% increase in July, matching expectations. Core inflation is slightly better at 2.6% year-over-year, leading analysts to predict that the Federal Reserve will likely implement a rate cut. Many experts believe the anticipated job reports in the coming week could influence the extent of this cut, with possibilities of a 25 or even 50 basis point reduction. The overall sentiment is that current inflation levels will not deter the Fed from proceeding with cuts, marking a notable shift in market forecasts.
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