CNBC Daily Open: Wall Street’s ‘dress rehearsal’

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CNBC Daily Open: Wall Street’s ‘dress rehearsal’

Traders work the floor of the New York Stock Exchange on August 16, 2024. 

Angela Weiss | AFP | Getty Images

This report is from today’s CNBC Daily Open, our international markets newsletter. CNBC Daily Open brings investors up to speed on everything they need to know, no matter where they are. Like what you see? You can subscribe here.

What you need to know today

Best weekWall Street had its

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of 2024, recovering from a rout earlier this month. For the week, the

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surged nearly 3.9%, bringing it within striking distance of its July record high. The tech-heavy

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saw an even more impressive 5.2% gain, while the

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advanced a solid 2.9%. Meanwhile, the yield on the 10-year

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as data eased concerns of an imminent recession.

Oil sinks

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dropped 2% following reports that

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amid ongoing *******-****** cease-***** talks. Qatar’s prime minister warned Iranian leaders of the potential consequences of striking ******* when progress is being made, the Washington Post reported, citing diplomats. Talks are expected to resume this week after negotiations were paused on Friday. ****** did not take part in talks but was briefed by mediators. U.S. Secretary of State Antony Blinken

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on Sunday, as efforts intensify to end the 10-month-old war between ******* and ******.

BlockedA U.S. judge has temporarily

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, a sports streaming service from

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,

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and

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.

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, a competitor, filed an antitrust lawsuit, alleging Venu would harm competition. “Today’s ruling is a victory not only for Fubo but also for consumers. This decision will help ensure that consumers have access to a more competitive marketplace with multiple sports streaming options,” Fubo CEO David Gandler said after the injunction. Fubo’s stock surged 16% after the ruling. 

Mpox approval Shares of

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14.8% after the Danish biotech firm

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to the ********* Union’s ***** regulator to extend its mpox vaccine approval for 12 to 17-year-olds. CEO Paul Chaplin said the move is key in combating the new clade 1b strain, which primarily affects younger people. “More than 70% of the cases in ******* currently are in people younger than 18, so it’s going to be critical that our vaccine can be used in this younger age group,” Chaplin told CNBC. The submission comes after the World Health Organization declared the mpox outbreak in ******* as a public health emergency. 

Asia markets mixedAfter a broad rally last week,

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as investors awaited economic data and central bank interest rate decisions. Japan’s

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snapped a five-day winning streak, sliding 1.7% after

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fell surprisingly short of expectations. South Korea’s

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dipped 0.85%, while Australia’s

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nudged up 0.12%. Hong Kong’s

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rose 0.93% as

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soared 4.4% after posting

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. Mainland China’s CSI 300 climbed 0.4%.

[PRO] Bond market rallyChina’s central bank aims to

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, sparking concerns about financial stability. Analysts predict a slight increase in 10-year bond yields.

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.

The bottom line

For anyone waking up in a cold sweat, rest assured — it wasn’t just a bad dream. Global markets did experience a

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, with Japan’s

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and

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dragging Wall Street down with it. However,

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, reassured by signals that Japan’s central bank will not raise rates in such a volatile environment and that the U.S. economy isn’t on the verge of a recession. 

But JPMorgan sees the recent turmoil as more than just a market anomaly. “Many market participants are dismissing the recent blowup of various crowded trades as a fluke or flash cash, but we see it as more of a

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for what’s to come,” JPMorgan strategists said in a note.

The financial giant believes that while the risks associated with the carry trade could resurface, the heavy losses investors suffered may temper its future impact, potentially preventing a full-blown market meltdown. Nevertheless, JPMorgan cautions that concerns about economic growth remain a significant threat.

“Looking ahead, until the Sharpe ratios on the carry trades get high, we would not think these would be the catalyst for the next major correction,” the firm said. “Instead, we see the reemergence growth risk as the likely trigger.”

Last week’s U.S.

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, retail sales and jobs data may have provided some short-term reassurance, but investors are now turning their attention to Federal Reserve Chair Jerome Powell’s upcoming speech in Jackson *****, Wyoming. Wall Street is eagerly awaiting Powell’s

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on inflation and the broader economy, as it could signal the direction of interest rate policy — particularly ahead of a possible September rate cut.

Market expectations for a large rate cut in September have diminished. According to the CME

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, investors are still pricing in at least four rate cuts by the end of the year. 

However, Goldman Sachs argues that this level of

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. “The market is still pricing more cuts than our base case for 2024,” which includes a 25-basis-point cut at each of the next three meetings and beyond, Goldman noted. “Another weak jobs report would put a 50-basis-point cut in September on the table, but we think the markets has been over-weighting that probability.” 

CNBC’s Jeff Cox examines

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.

— CNBC’s Yun Li, Jesse Pound, Spencer Kimball, Brian Evans, Alex Harring, Jeff Cox, Lillian Rizzo, Karen Gilchrist, Sean Conlon, Lim Hui Jie and Weizhen Tan contributed to this report.

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#CNBC #Daily #Open #Wall #Streets #dress #rehearsal

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