Fed Policy Meeting Kicks Off, PG Slumps
Let's see what to expect from the FOMC and why we should watch Procter & Gamble and Corning right now.
You've reached your free article limit
You've read 0 of 1 free Pro articles.
The Federal Reserve's open market committee two-day meeting - fifth of 2024 - kicks off today. The consensus view is continued holding tight on policy, which will be the eighth-straight meeting that keeps rates where they are. It has been a year since the committee last moved rates, a quarter-percentage point hike in July 2023.
As it turns out, the FOMC commitment to "higher for longer" may have just been the right touch to gently land the economy. Of course, a strong labor market has helped immensely in this endeavor, and it's too early to declare a victory over inflation. But recent data and trends tell us the policy was correct and is still valid, though there are signs the committee will start to pivot toward a dovish policy before the year is over.
Wednesday's decision, statement, and follow-on press conference with Chair Jay Powell will go a long way in determining how soon cuts will happen and perhaps how many can be expected. Markets are assuming a more aggressive policy for the end of the year but that may be an outlier.
Stocks: Procter & Gamble Misses
Markets were mixed Monday as Nasdaq stocks were the big beneficiary of money flows. The Nasdaq 100 is in the midst of a corrective period and may need a bit more time and price (at current levels) before we see this index start moving higher. However, higher volatility in markets means the ranges are expanding and may produce some angst or indigestion.
Procter & Gamble PG reported a miss on revenues this morning, but a beat on the bottom line. The company sees some challenges with the consumer down the road, most of their report was just in-line. Pepsi PEP may feel some effects here as PG is a big proxy for grocery shopping.
Corning GLW reported earnings this morning and offered a downbeat forecast for the third quarter on revenues. This may have some negative readings for portfolio names Nvidia NVDA and Marvell MRVL down the road but those two names will report earnings later in August.
LGIH LGIH put together a terrific quarter on strong demand and updated guidance for 2024. This may bode well for Builders FirstSource BLDR, which is in TheStreet Pro portfolio, specifically with demand for building materials, tools.
The Portfolio is long BLDR, NVDA, MRVL.
