U.S. Stocks: Rally Pushes Higher
Equities advanced broadly, with technology continuing to lead the charge.
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S&P 500: Rose 2.0%, setting another record high.
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Dow Jones Industrial Average: Gained 1.2%, supported by banks, energy, and select industrials.
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Nasdaq Composite: Jumped 3.5%, fueled by strength in mega-cap tech and investor enthusiasm around AI-driven earnings.
Investor sentiment improved as the probability of a September Fed rate cut solidified, adding a supportive tailwind for risk assets.
Global Markets: Uneven but Stabilizing
Performance abroad remained mixed versus U.S. markets.
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Europe: Markets advanced modestly, lifted by better-than-expected industrial output, though retailers continue to struggle with sluggish consumer demand.
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Asia: Japan gained on stronger factory orders and yen stability, while China’s prolonged housing downturn led to more caution despite resilient export volumes.
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IMF Outlook: The IMF reiterated its global growth forecast of 2.9% but warned that elevated trade frictions remain the key downside risk.
Bonds & Interest Rates: All Eyes on the Fed
Fixed income markets stayed relatively calm but aligned with expectations for cuts.
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U.S. Treasury Yields: The 10-year yield eased slightly to 4.20%, as bond markets priced in policy accommodation.
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Fed Policy: Futures now fully expect a September rate cut, with two more likely before year-end.
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Mortgage Rates: Continued to drift lower, averaging just under 6%, giving housing a modest late-summer lift.
U.S. Economy & Inflation: Slow but Resilient
Economic data suggested steady but moderating momentum.
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Growth: Q2 GDP was revised to 1.5%, confirming cooling but stable expansion.
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Employment: Unemployment remained at 4.1%, while wage growth stabilized at 3.8%.
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Inflation: The PCE report for July pointed to 2.7% core inflation, keeping the Fed on track for policy easing as inflation edges closer to target.
Key Drivers This Week
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Tariffs & Trade: Headlines around U.S.-China trade actions continued to weigh on sectors reliant on global supply chains.
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Fed Commentary: Officials emphasized readiness to cut rates but reinforced commitments to data dependency.
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Consumer Confidence: August measures showed further softening, reflecting increasing household caution despite easing prices.
Looking Ahead: Next Week’s Key Events
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Tuesday, September 2: ISM Manufacturing Index—an early signal of momentum heading into fall.
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Thursday, September 4: Weekly jobless claims; labor market cooling will be closely watched.
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Friday, September 5: August Employment Report, potentially pivotal ahead of the FOMC decision later in the month.
Global Watch:
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Japan releases July retail sales.
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Eurozone flash inflation data due midweek.
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China posts key trade figures that will reveal whether export resilience can offset housing softness.
The Bottom Line
Markets extended their late-summer rally, supported by strong tech earnings and firm expectations of Fed policy easing. Yet risks remain: consumer fatigue, uncertain trade policy, and global growth headwinds could test investor confidence. With September approaching, the Fed’s September decision and incoming inflation and jobs data will be critical in determining whether equities maintain upward momentum—or pause for consolidation.
For more information and personalized guidance, please feel free to reach out to Vistamark Investments LLC. You can contact us at
312-895-3001, visit our website at
www.vistamarkllc.com, or send us an email to
info@vistamarkllc.com.
