Investment Week at a Glance
Stocks finished mixed for the week. The Dow Jones Industrial Average fell 0.3%, the S&P 500 was up 0.3%, and the NASDAQ rose 1.1%. Foreign stocks (MSCI EAFE) were down, falling 0.8%. Bond prices were up for the week, with the 10-year U.S. Treasury ending the week at 4.09%. (Data source: Wall Street Journal)
Jobs Report Once Again Shows Weakness
The August jobs report was released last week and once again came in weaker than expected. Only 22,000 jobs were added in the month of August, and unemployment rose to 4.3%, the high of the year. Markets had little reaction to the number on Friday as equities fell slightly. Another sign of weakness in the labor market is that job openings fell to a low since 2020. There are also now more unemployed people than open jobs in the United States, which has not happened since 2021.
Odds of Fed Rate Cut Increase
With the weak jobs report coming in on Friday, yields fell, and the probability of a September rate cut is now being priced in at 100%. There is even now an 8% chance of a 0.50% rate cut, although unlikely, it does show the confidence of the market that we get a rate cut next week. Investors will continue to pay attention to the incoming economic data to see if recession worries come back into play.
Warren Buffett Speaks Out Against Kraft Heinz Split to 2 Companies
Kraft Heinz announced they will be splitting into two companies, undoing the move to merge back in 2015, which Buffett helped orchestrate. Buffett has always been known to be a passive investor and rarely speaks out against companies he is invested in, so the criticism came as a surprise to many. Buffett also expressed his disappointment that there would not be a shareholder vote on the matter. Berkshire owns 27.5% of Kraft, making them the largest shareholder by far. Time will tell if this is the right move for the company. (CNBC)
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Quiz
How many job openings are there currently in the U.S.? (Scroll Down for Answer)
- 6.4 million
- 7.2 million
- 8.5 million
- 9.3 million
Answer:
2. 7.2 million. There are 7.4 million people who are unemployed in the U.S. making it the first time since 2021 more people are looking for jobs than actual jobs open.
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