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Morning Research Notes - 05.11.24
Yesterday, US markets declined as investors exercised caution ahead of the presidential election and the Federal Reserve’s anticipated rate decision. Major commodities had a bullish day: Spot gold increased by 0.1% to $US2738.75 per ounce, Brent crude rose by 2.7% to $US75.07 per barrel, while iron ore climbed by 2.1% to $US104.25 per tonne.
On Monday, Wall Street experienced declines with the S&P 500 down 0.3%, the Dow Jones Industrial Average dropping 257 points (0.6%), and the NASDAQ Composite slipping 0.3%. Investors were cautious ahead of the presidential election and the Federal Reserve’s upcoming rate decision. The tight race between Donald Trump and Kamala Harris, along with concerns over potential US-China tech conflicts and tariffs under a possible Trump victory, added to market jitters. NVIDIA is set to join the Dow Jones Industrial Average, replacing Intel. Earnings reports continued, with Berkshire Hathaway and Marriott International missing forecasts, while Viking Therapeutics faced production concerns despite positive trial results. The Fed is expected to cut interest rates by 25 basis points, with markets closely watching for future rate cut signals amidst mixed economic data.
On Monday, the Australian stock market closed higher, with the ASX 200 gaining by 0.56%. This upward trend was evident across major indices, with the Financials, Info Tech, Health Care, and Utilities sectors recording gains of 0.84%, 1.71%, 1.23%, and 1.7%, respectively. However, the Materials sector declined, falling by 0.46%. Major commodities had a mixed day: Nickel ended in the green, rising by 2%, while Copper, Aluminium, and Zinc fell by 0.15%, 0.02%, and 1.27%, respectively.
Chart of the day
One possible explanation for stagnant wages is that the number of workers who left the US workforce following the 2007-2009 recession was higher than first thought. The labour force participation rate refers to the number of people who are either employed or are actively looking for work. Following the global economic crash, the labour force participation rate in the US fell dramatically and now stands at 63%. It has remained stable since Mr Trump was elected.
Source: BBC
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