CNBC Daily Open: ‘Crazy’ summer

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CNBC Daily Open: ‘Crazy’ summer

Traders work on the floor of the New York Stock Exchange during morning trading on Aug. 20, 2024.

Michael M. Santiago | 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

End of a runWall Street

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ending a multi-session winning streak. After an eight-day run-up, the

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and the

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climbed 0.2% and 0.3% respectively. The

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dropped 0.2%, snapping a five-day win streak.

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was among the biggest decliners, down 4.2%, after finding

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on a 777X test plane. Meanwhile, the yield on the 10-year

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was

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as investors await minutes from the Federal Reserve’s July meeting due Wednesday.

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below $74 a barrel on demand concerns. 

Diabetes risk cut

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‘s weight loss ***** tirzepatide, used in Zepbound and Mounjaro,

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by 94% in obese or overweight adults with prediabetes, according to preliminary findings from a long-term study. The trial, which studied over 1,000 participants over 176 weeks, also showed sustained weight loss, with patients on the highest dose losing 22.9% of body weight on average. The results highlight the potential of GLP-1 drugs in delaying diabetes and offering significant long-term health benefits for people with obesity and prediabetes. Eli Lilly’s shares rose 3%.

Waiting for Fed cut

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has

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as it anticipated weak home improvement spending. CEO Marvin Ellison told CNBC that consumers are waiting for the Federal Reserve to cut interest rates. “Inflation ******** high,” he said. “And big-ticket purchases are being delayed as customers sit back and wait for interest rates to fall.” Lowe’s stock dropped 1.2%.

Shein sues TemuChinese-linked fast-fashion retailer

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for allegedly stealing its designs and engaging in counterfeiting, intellectual property infringement and ******. Shein, which filed the suit in Washington D.C. on Monday, is

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from the likes of

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and H&M. Shein claims Temu falsely presents itself as a legitimate marketplace while actively encouraging its sellers to copy designs and preventing them from removing infringing products.

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, which owns Temu, dropped 4.5% on Tuesday. 

China EV tariffsThe ********* Union

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on

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vehicles imported from China, from 20.8% to 9%. The ********* Commission hit “heavily” subsidized ******** electric vehicle imports with tariffs in June, saying they “pose a threat of economic injury” to local EV manufacturers. The EU has also lowered tariffs for other ******** electric vehicle companies, including

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,

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 and

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.

[PRO] Avoid crowded tradesMorgan Stanley warns that individual investors should be cautious about buying stocks favored by hedge funds. Such “

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” often face high valuations and increased volatility, making it difficult to find new buyers.

The bottom line

As the S&P 500 and Nasdaq ******* to extend their recovery rally into a ninth session, it’s worth reflecting on the past few weeks. When asked by CNBC’s Sara Eisen to describe the market’s current state, Holly Newman Kroft of Neuberger Berman Private Wealth said “

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” this summer.

“We couldn’t have scripted a better start to the summer with equities really rallying and everyone feels good when the market goes up. The last six, seven, eight weeks have been many head-spinning turns of events. We had an ************** attempt. We had a broadening of the market. We had the market pricing in a Trump win, a red wave. Then we had Biden drop out, Kamala come in and now its sort of a ***** heat,” Kroft explained.

Kroft said the market is navigating an uncertain environment plagued with volatility. “Two weeks ago, in the face of a not-great-jobs number — it wasn’t bad jobs number but it wasn’t great — we had a knee-***** reaction in the market. And so on Monday it opened down almost 10%. What’s kind of also mind-blowing is by the end of the week the market was flat.”

With the S&P 500 less than two percentage points shy of its July record high, Kroft sees limited upside and expects more volatility to pick up into the election. What the markets need is for “calmer heads to prevail in the role of the Fed,” she said.

Oppenheimer’s chief investment strategist, John Stoltzfus, said Fed Chair Jerome Powell’s speech on Friday

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, with investors awaiting rate cuts at the central bank’s September meeting.

“With many folks now looking for a cut of as much as 50 bps in September, a degree of hesitancy in the Chair’s remarks could reintroduce some volatility into the market ahead of next weekend,” Stoltzfus wrote in a Monday note. Still, he believes a 25 basis-point cut is more likely, given last week’s stronger-than-expected jobs and retail sales data.

Yung-Yu Ma, investment chief at BMO Wealth Management, believes the

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than investors anticipate. “We think that the rate cuts are actually going to have much stronger and favorable impact, probably than the markets are pricing in now,” Ma told CNBC’s “Money Movers.”

“Maybe not the first rate cut, but after we get 75 basis points, 100 basis points of rate cuts, we think there’s a lot of pent-up demand lurking beneath the surface,” Ma added.

— CNBC’s Hakyung Kim, Sarah Min, Alex Harring, Gabrielle Fonrouge, Yun Li, Melissa Repko, Annika Kim Constantino and Spencer Kimball contributed to this report.

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#CNBC #Daily #Open #Crazy #summer

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