US End of Session Notes – 31.08.2021

US End of Session Notes

In the US, indices were mixed on the first trading day of the week, with the statements of Fed members, geopolitical developments, and the increase in value in technology companies. The S&P 500 index broke its 53rd record in 2021. The year 2021 (the S&P 500 index) was the year with the most record-breaking until August. On the other hand, the Jackson Hole symposium took place over the weekend. At the end of the session, the Dow Jones index decreased by 0.16 percent to 35399, the S&P 500 index increased by 0.43 percent to 4528 and the Nasdaq index increased by 0.90 percent to 15265.

The dollar index in Forex markets is watching with sellers today. The 10-year Treasury bond yield was at 1.29 percent at the end of the session closing. Index futures, on the other hand, are trading with sellers. 4508 level is followed as support and 4580 level as resistance in S&P 500 index.

Personal spending in the US rose 1.1 percent in July. Personal income exceeded forecasts in July, while spending fell short of expectations. Pending home sales in the US in July decreased by 1.8 percent compared to the previous month.

On August 30, 280,403 cases of coronavirus were detected across the United States. The average number of coronavirus cases detected in the last 7 days was approximately 158,946. The average case detection for the last 7 days has increased by 12 percent compared to 14 days ago. Approximately 205 million people in the country have received at least one dose of the coronavirus vaccine, and approximately 174 million people have received two doses. While the European Union updated its travel measures due to the coronavirus epidemic, it also removed the USA from its safe travel list.

The United States announced its complete withdrawal from Afghanistan.
General Kenneth McKenzie, Commander of the US Central Command (CENTCOM), announced the completion of the withdrawal from Afghanistan and the end of the military mission to evacuate American citizens, third-country nationals, and vulnerable Afghans. McKenzie said that they evacuated 123 thousand people during the 18-day withdrawal period and that they rendered more than 90 armored vehicles and 73 aircraft unusable and left them at Kabul’s Hamid Karzai Airport, as well as anti-rocket guns.

In his speech at the Jackson Hole Economic Policy Symposium, US Federal Reserve (Fed) Chairman Jerome Powell said:

“It may be appropriate to start reducing bond purchases this year. The reduction in bond purchases is not a direct signal of the timing of an interest rate hike.”

Powell stated that the price increases are concentrated in certain products and that the price pressure will decrease in durable consumer goods. Fed Vice Chairman Richard Clarida said he agrees with Powell, saying that asset purchase reduction could begin this year as the job market continues to improve. Clarida predicted that the rise in inflation was also temporary and that the Central Bank would reach its 2 percent target in 2022-2023. Philadelphia Fed President Patrick Harker said he supports early cuts in bond purchases. Atlanta Fed President Raphael Bostic also told CNBC that the economy is in good shape to reduce its $120 billion monthly asset purchase program.

Last week, the US House of Representatives approved US President Joe Biden’s $3.5 trillion budget plan, which is a key part of the economic agenda. Biden, at the press conference, expressed his satisfaction with the decision of the House of Representatives and said that they are one step closer to investing in the American people. The $3.5 trillion budget plan, which is the second phase of Biden’s economic plan, includes investments in social security programs and climate policy.

7 of the 11 sectors with S&P 500 companies gained value. While the information technologies and real estate sectors were the biggest winners of the day, the financials sector was the most depreciated of the day. DoubleDown Interactive and Focus Universal are scheduled to go public this week. However, Broadcom, Zoom, and CrowdStrike are among the companies that will announce balance sheets this week.

SEE ALSO: What is FOMC? Why is it Important for Markets?

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Caroline Tetra

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