Markets see Fed easing ahead 09/09/2025

HOT stories for today

US market wrap:

• The Nasdaq Composite ended at a fresh record on Monday as traders prepared for a week packed with economic data, highlighted by two key inflation updates. The tech-focused Nasdaq climbed 0.45% to 21,798.70, marking a new closing record after reaching an all-time intraday peak earlier in the session. The S&P 500 edged up 0.21% to 6,495.15, while the Dow Jones Industrial Average advanced 114.09 points, or 0.25%, finishing at 45,514.95. 
• Gains were primarily driven by a rally in chipmaker Broadcom, which jumped 3%, and artificial intelligence favorite Nvidia, which rose nearly 1%, trimming some of the sharp declines it has faced over the past month. Amazon and Microsoft shares also moved higher. Market participants are anticipating two significant inflation readings this week to gauge the strength of the U.S. economy, following weaker-than-expected job growth reported Friday. The producer price index (PPI) for August is scheduled for release Wednesday morning, followed by the consumer price index (CPI) on Thursday.

Markets see Fed easing ahead

• Traders see the Federal Reserve cutting rates next week, most likely by 25 basis points, though a slim chance remains for a half-point move. As of Monday, the CME FedWatch tool indicated that the odds of a quarter-point cut stood at 88%, while the odds of a larger reduction were 12%. Expectations for easing rose after August’s jobs report showed just 22,000 payroll gains and unemployment climbing to 4.3%, a near four-year high. 
• Citigroup economist Andrew Hollenhorst said the weak data strengthen the case for cuts, though most policymakers are unlikely to back a 50-basis-point move. Citi projects reductions at the following five meetings, while Nomura expects more cautious steps unless labor conditions deteriorate further. Markets currently anticipate cuts in September and December, with a pause in October. This week’s inflation reports will be pivotal, with CPI expected at 2.9% and core at 3.1%. A hotter reading could complicate the Fed’s decision as it weighs persistent price pressures against a weakening labor market.

Stocks on the move:

• Fox Corp. (FOXA): The stock fell more than 2% after the company said the Murdoch family resolved a dispute over its trust, granting Lachlan Murdoch full control of the media conglomerate.
• Dell Technologies (DELL):  Shares dropped about 2% after the firm announced CFO Yvonne McGill will step down effective Tuesday. David Kennedy, senior VP of global business operations and finance, will serve as interim finance chief.
• Mission Produce (AVO): The avocado and mango distributor jumped over 4% after fiscal Q3 results topped estimates. The company posted earnings of $0.26 per share (ex-items) on $357.7 million in revenue, beating FactSet’s forecast of $0.15 per share on $320.3 million in revenue.
• Casey’s General Stores (CASY): Shares edged down less than 1% despite a stronger-than-expected fiscal Q1. The chain reported EPS of $5.77, ahead of the $5.02 consensus, with revenue of $4.57 billion surpassing the projected $4.46 billion.

Watchlist: NVDA, AMD, AVGO, FOXA, DELL, RDDT, CASY

Today’s action

• Asia-Pacific equities traded mostly higher on Tuesday, mirroring Wall Street’s strength. Japan’s Nikkei 225 jumped 0.9% to a record high, logging its second straight day of gains after Prime Minister Fumio Kishida announced his resignation on Sunday. The Topix advanced 0.52%. 
• In the U.S., stock futures were little changed Monday night after the Nasdaq Composite closed at a fresh record. Dow futures gained 57 points (0.13%), while S&P 500 futures and Nasdaq 100 futures edged up 0.12% and 0.11%, respectively. Investors will watch the release of the NFIB Small Business Optimism Index on Tuesday morning for insights into sentiment. A weaker reading could signal added pressure on the labor market, given small firms’ outsized role in U.S. hiring. After the bell on Tuesday, GameStop (GME) and Oracle (ORCL) are scheduled to report earnings.

Bitcoin

• Bitcoin (BTC) is holding just above $112,000, showing modest gains and a steady start to the day. Optimism around potential Federal Reserve rate cuts continues to support bullish sentiment. In other developments, a massive NPM supply-chain hack has shaken the industry, with malware injected into widely used JavaScript libraries, potentially hijacking wallet addresses in what’s being called the largest supply-chain attack in crypto history.
• Meanwhile, Michael Saylor’s Strategy (MSTR) expanded its Bitcoin holdings, buying 1,955 BTC (~$217M) between Sept. 2–7. The company now owns 638,460 BTC, according to its SEC filing.
  Watchlist: Bitcoin: 99 000-125 000, Ethereum: 4000-4980, Solana: 160-214

Forex

• The yen strengthened Tuesday, pushing USD/JPY to 147.00, as upgraded Japan Q2 GDP, firmer household spending, and rising wages bolstered BoJ rate hike bets. 
• The euro extended gains, with EUR/USD near 1.1780, supported by Fed cut expectations after weak U.S. jobs data. Markets now see a 10% chance of a 50 bps move in September, even as France’s government collapsed following a loss of confidence vote.
  Watchlist: EUR/USD: 1.0700-1.1700, USD/JPY: 140-151

Basic Materials

• Gold (XAU/USD) hit fresh record highs above $3,650 for a third straight day on Tuesday, buoyed by Fed rate cut bets that keep the USD under pressure. Traders now price in up to three cuts this year, though overbought conditions suggest caution.
• WTI crude edged up to around $62.15 after OPEC+ confirmed a smaller October supply increase of 137,000 barrels per day (bpd). Investors await the API's weekly inventory data later today.
  Watchlist: GOLD: 2600-3700, US Oil: 55.60-75.80

Key Economic Events Today:

EST time

06:00 am: USD NFIB Small Business Index


Earnings

BMO (Before Market Open):

CNM                    Core Main Inc.
SAIL                      SailPoint Inc.

AMC (After Market Close): ORCL, GME, AVAV



The TEFS Analyst team wishes you a successful day!