Investment Week at a Glance
Stocks finished up last week. The Dow Jones Industrial Average was up 0.5%, the S&P 500 rose 0.6%, and the NASDAQ was up 1.3%. Foreign stocks (MSCI EAFE) were down for the week, falling 0.2%. Bond prices were up for the week, with the 10-year U.S. Treasury yield ending the week at 4.72%. (Data source: Wall Street Journal)
Fed Chair Warsh’s 1st Jackson Hole Economic Symposium
Fed Chair Warsh had his first Jackson Hole meeting last week and came out as hawkish which surprised markets just a little. Markets are now pricing in a 64% chance of a hike in September and an 88% chance of a hike by year end. Warsh empathized the 2% target for inflation which some read as an effort to reinforce Fed independence. Many thought this speech calmed some nerves and gave investors a clearer picture of Warsh and his view on the economy.
August Jobs Report Could Impact the Fed’s Interest Rate Decision
On Friday, September 4th, the Department of Labor is set to release employment data for August. This jobs report could be one of the most significant economic reports of the year, as it could significantly influence a looming Fed decision in the middle of the month. Currently, economists are forecasting the economy to have added around 50,000 jobs in August. However, a stronger-than-expected number could dramatically increase the odds of a rate hike from the central bank.
Micron Stock Up 195% Year to Date, and Nearly 700% In the Last Year
Micron (MU), one of the leading manufacturers of computer memory chips, has had an incredible run in 2026 as the AI boom has dramatically increased demand for the company’s products. Entering 2025, few investors had heard of the company, and now it is the 11th largest by market cap in the S&P 500 index. So far this year, in just three quarters, Micron’s earnings per share have grown from $4.78 to $25.11, which helps justify the rapid increase in the company’s stock price. Analysts are expecting another monster quarter from the newest tech giant, as earnings estimates are well over $30 per share. The company is set to release earnings on September 30th, and investors should be prepared for some volatility with the stock around that time (CNBC).
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Quiz
What are markets currently expecting the Fed to do with interest rates at this month’s FOMC meeting? (Scroll Down for Answer)
- Cut interest rates by 0.25%
- Raise interest rates by 0.25%
- Keep interest rates unchanged
- Raise interest rates by 0.50%
Answer:
2. Raise interest rates by 0.25%. Currently bond markets appear to be pricing in a rate hike of around 25 basis points. Following Federal Reserve Chairman Kevin Warsh’s speech at Jackson Hole last week, markets think there is around a 64% chance that the Fed will increase interest rates in September.
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