Weaker economic data boost lower probability of rate hike

Weaker economic data is good news.

Equity markets received yet another boost from the latest economic data. The ADP’s private payroll showed a softer labour market, and GDP for the second quarter had been revised lower, all pointing to signs of a slowing economy. 

This is good news as it could reduce demand and balance the consumption level in the economy as the Fed seeks to cool inflation. 

Salesforce: A steady comeback

The cloud-based enterprise software giant Salesforce, had a good day as they reported better-than-expected earnings. Guidance was robust, and the operating margin jumped from 27.6% to 31.6% in the current quarter. 

The company did have several headwinds. The aggressive rollout of many AI software tools and raised prices help to cushion some impacts of generally weaker corporate spending. 

Companies are more conservating in their IT spending given a more uncertain macro-environment and the shift toward a wait-and-see mentality. 

CrwodStrike: Against all odds

 A decent set of financial results held the stock steady in the trading session as it boosted the full fiscal year outlook.

Some analysts were comforted by the “strength in profitability” as the company also shares a similar industry fate in an environment of lower corporate spending and a shift towards generative AI expenditure. 

What’s on the menu today?

It is the most critical day of the week. Today, we will receive the Core PCE Price Index at 8:30 pm. 

At the same time, Initial Jobless Claims will be released. We will also see personal spending data, which could shed light on the health of consumers’ spending. 

At 9 pm, Fed Collins will speak too and at 9.45 pm bring us to Chicago PMI. 

It is 31 August, Thursday, 8.55 am in Singapore and 8.55 pm in New York. It was a swinging market but turned steady as investors digested a better outlook of a soft landing and a lower possibility of a rate hike.

Have a splendid day at work and in school.

As always, cheers, 

Pika Nat.🧃

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