US stocks rebounded on Monday on the heels of the S&P 500's worst week since early 2023, as inflation came back into focus for investors gauging pressures that could influence the size of interest rate cuts.
The S&P 500 (^GSPC) climbed nearly 1.2%, coming off a hefty weekly loss. The Dow Jones Industrial Average (^DJI) jumped more than 450 points, or 1.2%, while the tech-heavy Nasdaq Composite (^IXIC) rose more than 1%.
Financials (XLF), Industrials (XLI), and Energy (XLE) stocks led the market rebound. Nvidia (NVDA), Tesla (TSLA), and Amazon (AMZN) led gains among the megacaps.
The major averages regained some of the ground they lost after the August jobs report failed to settle a key question: How aggressively will the Federal Reserve lower interest rates? The neither-hot-nor-cold data left Wall Street guessing whether a cut of 25 or 50 basis points is likely at this month's policy meeting.
Focus is now on a fresh consumer inflation print due Wednesday to provide clues to the path of rates. The reading on price pressures will be followed by a producer inflation report on Thursday, the last inflation inputs before the Fed's policy decision on Sept. 18.
Meanwhile, Apple (AAPL) debuted its iPhone 16 smartphone at its annual product unveiling event in Cupertino, California. The tech giant also announced updates to its entire Apple Watch lineup, and AirPods Pro 2 which include new hearing protection features. Shares were little changed on the day.
LIVE COVERAGE IS OVER13 updates
Ines Ferré
Dow gains more than 450 points, S&P 500, Nasdaq rebound from steep weekly loss
The S&P 500 (^GSPC) climbed more than 1%. The Dow Jones Industrial Average (^DJI) jumped more than 480 points, or 1.2%, while the tech-heavy Nasdaq Composite (^IXIC) rose about 0.9%.
Among the megacaps, AI chip heavyweight Nvidia (NVDA) rose more than 3% while EV giant Tesla (TSLA) gained more than 2%.
Investors will turn their focus this week to a fresh consumer inflation print due Wednesday followed by a producer inflation report on Thursday, data points on pricing pressures before the Fed's policy decision on Sept. 18.
Last Friday's jobs report prompted a heavy stock sell-off as investors were left wondering whether policymakers will cut interest rates by 25 basis points or 50 basis points later this month.
Apple's (AAPL) debuted its iPhone 16 smartphone at its annual event in California on Monday. The tech giant also announced updates to its entire Apple Watch lineup and AirPods Pro 2, which include new hearing protection features.
Ines Ferré
Bad news for EVs: Consumers less likely to buy one compared to last year
In another blow to America’s EV transition, buyers are balking at purchasing a new EV.
In its latest Mobility Consumer Index (MCI), consulting firm EY found that only 34% of US consumers plan to purchase an electrified vehicle (meaning fully electric, plug-in hybrid, or hybrid) as their next car. That's down from 48% in EY’s 2023 survey.
Apple (AAPL) debuted its iPhone 16 smartphone line during its "Glowtime" event at its headquarters in Cupertino, Calif., on Monday. The phones come in four styles: the iPhone 16, the iPhone 16 Plus, and the premium iPhone 16 Pro and iPhone 16 Pro Max.
The new phones are Apple's first designed specifically with its Apple Intelligence AI platform in mind and feature more powerful chips that can operate the software. The base iPhone 16 and iPhone 16 Plus now come with the same programmable Action button found on last year's iPhone 15 Pro line.
Morgan Stanley cuts oil price target for second time in a month as prices plunge to 2024 lows
Wall Street has turned gloomier on oil prices as signs of weak demand and plenty of supply have weighed on the crude market.
On Monday, Morgan Stanley cut its Brent (BZ=F) forecast for the second time in a month, citing recent price declines that signal the risk of "considerable demand weakness."
The analysts now predict Brent will average $75 in the fourth quarter of this year, $5 lower than the prior downwardly revised forecast of $80 issued in late August.
On Monday, West Texas Intermediate (CL=F) rose to trade above $68 per barrel, while Brent, the international benchmark, was hovering near $71.80 per barrel.
Apple (AAPL) announced the new entry-level AirPods 4 and AirPods 4 with active noise cancelation, upgraded AirPods Pro 2 with a built-in hearing aid function, and new colors for the AirPods Max over-the-ear headphones during its annual iPhone event at its Cupertino, Calif., headquarters on Monday.
The AirPods Pro 2 include new hearing protection features, reducing louder, more intermittent noise while still preserving the sound of what you're listening to. Apple says it's also including a new five-minute clinically validated hearing test with the AirPods Pro 2. When you're finished, you'll get your results, which you can then share with your doctor.
Apple (AAPL) announced updates to its entire Apple Watch lineup during its annual iPhone event at its Cupertino, Calif., headquarters on Monday.
The changes include a new Apple Watch Series 10 and updates to its Apple Watch Ultra 2.
The Apple Watch Series 10, which start at $399, gets the biggest changes of the lot, with Apple increasing the display size of the 41-millimeter model to 45 mm and the previous 45-mm edition to 49 mm. The watches also sport slimmer casings than their predecessors.
The displays offer up to 30% more screen area than the Apple Watch Series 6, giving users can space to view more text and making it easier to type messages, enter passcodes, and check emails.
Stocks rose to hover near session highs on Monday afternoon amid a market rebound following last week's sharp losses.
Industrials (XLI), Financials (XLF), and Consumer Discretionary (XLY) led the gains as the Dow Jones Industrial Average (^DJI) soared more than 600 points, or 1.6%.
The S&P 500 (^GSPC) also gained more than 1% while the tech-heavy Nasdaq Composite (^IXIC) increased roughly 1.3%.
Stocks were rebounding on Monday following their worst week of the year.
All of the S&P 500 sectors were in green territory on Monday during a broad market rebound.
Dani Romero
Redfin CEO: Mortgage rates may not be a guarantee to drop from here
All signs are pointing to the Federal Reserve cutting interest rates this month, but there’s no guarantee that mortgage rates will drop even further, according to Redfin’s (RDFN) CEO.
“There's a consumer perception that when the Fed lowers rates, mortgage interest rates will drop further, but mortgages have already priced in at least a quarter point cut,” Redfin CEO Glenn Kelman told Yahoo Finance.
“And if that is all that we get, we might actually see mortgage rates increase, whereas if we get a 50 basis point cut rates will drop further,” the executive added.
Mortgage rates have been declining since May. The average rate on the 30-year fixed-rate mortgage remained steady last week at 6.35%, Freddie Mac reported. That's significantly lower than the 7% rate last year.
But the big question for the central bank is whether a modest interest rate cut will be enough to maintain economic growth. The Fed doesn’t set mortgage rates but its policy moves influence the direction of where rates will go.
Still, consumers remain optimistic about the future direction of mortgage rates despite homebuying sentiment remaining sluggish. Fannie Mae’s national housing survey in August found that 39% of consumers expect mortgage rates to decline in the next 12 months, higher than 29% reported in the prior month.
"People are still waiting to see what the Fed is going to do," Kelman said.
Ines Ferré
Citi CFO eyes Tuesday talk for latest on Basel III endgame capital proposal
Yahoo Finance's David Hollerith reports:
During a fireside chat with analysts on Monday morning at a conference hosted by Barclays, Citigroup's CFO Mark Mason weighed in on the bank capital proposal Basel III endgame.
He was asked whether Citi plans to return more capital to shareholders in the upcoming quarter given the uncertainty around the new capital requirements. Mason indicated Citi will know more in the coming days.
"I think we'll all know a little bit more tomorrow when [Michael] Barr speaks. I'm glad that there's been a re-look, if you will, at the proposal. It sounds like we'll know even more in a week or so, when perhaps a document actually comes out and we're able to assess that," said Mason.
By tomorrow, the executive is referring to a public talk Tuesday morning hosted by the Brookings Institution in Washington where the Fed's Vice Chair for Supervision Michael Barr is expected to address the changes.
First unveiled in July 2023, Basel III endgame is a set of strict bank capital requirement rules aimed at ensuring financial institutions can weather loan losses in the event of rough economic times.
Last year's initial proposal received immediate pushback from the banking industry and its lobbyists in Washington, who even threatened to sue if the original proposal was not changed before becoming final.
Ines Ferré
Trump vs. Harris: The economic topics to watch during tomorrow's debate
On Tuesday night, Kamala Harris and Donald Trump will meet for the first time — literally, as they’ve never met in person before — for a high-stakes debate in Philadelphia with economic issues likely to be front and center.
What is well known is how each side is likely to attack the other on fiscal issues. How they respond is where it could get interesting.
Former President Trump is highly likely to once again charge that Harris is a communist, echoing a favorite and baseless line in recent weeks that he's running against "Comrade Kamala." Vice President Harris is sure to shoot back with charges that Trump's plan could tip the country into a recession and send prices through the roof via his tariffsplans.
Both candidates could be flustered by directly wrestling with these charges, as they've often campaigned recently in scripted campaign appearances, speeches, or interviews with friendly interlocutors.
Nvidia (NVDA) shares gained more than 2% on Monday, helping lift the Nasdaq. The tech heavy index rose as much as 1.2% to lead the market gains.
Nvidia stock rebounded after losing almost 14% last week. The AI chip heavyweight has underpinned the market rally this year.
EV giant Tesla (TSLA) also rebounded as much as 4% on Monday following a pullback on Friday.
The Nasdaq led the market rebound on Monday
Brian Sozzi
Greetings from San Francisco
Hello from the Goldman Sachs Tech + Media conference in San Francisco!
The Yahoo Finance team is live today and tomorrow with some very big interviews, kicking off this morning with Goldman's chief economist Jan Hatzius and later on with AMD (AMD) CEO Dr. Lisa Su.
This conference comes at an interesting time in markets, when investors are looking for reasons to sell high beta AI plays such as Nvidia (NVDA).
For me, I will be aiming to ascertain whether these sell-offs are overdone based on executives' comments on demand trends. When I talked with Dell (DELL) founder and CEO Michael Dell last week, I didn't get the sense demand was softening very much if at all.
Some more of those upbeat vibes at this market-moving conference may be rather helpful in getting the tech trade back on stable footing.
Ines Ferré
Stocks rebound following worst week of the year
Stocks rebounded on Monday on the heels of the S&P 500's worst week since early 2023 as investors gauged the size of interest rate cuts the Federal Reserve could implement later this month.
The S&P 500 (^GSPC) rose 0.7% following a drop of 1.7% for the benchmark on Friday. The Dow Jones Industrial Average (^DJI) jumped 0.6%, while the tech-heavy Nasdaq Composite (^IXIC) increased roughly 0.9%.
The major averages are coming off a steep sell-off during September's first week of trading where semiconductor stocks led the declines.
Nvidia (NVDA), which fell 4% on Friday, opened nearly 2% higher on Monday as chip stocks advanced.
Investors are paying close attention to Apple's (AAPL) annual iPhone event, which kicks off on Monday.
