Two huge market events happened to occur during one of the sleepiest weeks of the year.<\/p>\n
Nvidia\u2019s eagerly awaited earnings and Federal Reserve Chairman Jerome Powell\u2019s equally-as-anticipated Jackson Hole speech managed to wake Wall Street from its summer snooze, ultimately snapping the S&P 500\u2019s three-week losing streak.<\/p>\n
But the latter, in particular, has largely left investors none the wiser. Powell reiterated that inflation remains too high and said the Fed will \u201ckeep at it until the job is done,\u201d and is prepared to raise rates further if needed.<\/p>\n
While hawkish in its tone, it was a speech devoid of answers. Powell\u2019s vagueness, and the Fed\u2019s data-dependent approach means investors will have to wait for the answers they crave about the future path of interest rates.<\/p>\n
It may not be a long wait, with the Fed\u2019s preferred inflation metric released Thursday, and August\u2019s jobs report Friday. Economists expect the core personal consumption expenditures (PCE) price index to rise at an annual rate 4.2%, up from 4.1% the previous month. That would certainly point to a more prolonged inflation battle ahead. <\/p>\n
The market remains confident the Fed will pause interest rates when it meets next month\u201480% sure, according to the CME\u2019s FedWatch tool. However, the probability of a hike at the Fed\u2019s November meeting climbed to 51% early Monday, from 38% a week ago.<\/p>\n
Economic data in the coming days can shift those odds, and move markets, particularly in a week that sees the end of August and its historically sleepy trading volumes.<\/p>\n
\u2014Callum Keown<\/em><\/p>\n *** Join Barron\u2019s deputy editor Ben Levisohn today at noon when he talks with senior writer Al Root about what comes next for the stock market as Jackson Hole recedes and payrolls loom, while taking time to consider where Tesla goes from here. Sign up here.<\/em><\/em><\/p>\n Try your hand at this morning\u2019s Barron\u2019s digital jigsaw, which is based on the week\u2019s cover story. For all games, including the daily crossword and sudoku, click here.<\/em><\/p>\n Fresh labor market and inflation data are coming out this week, and economists will be analyzing the numbers and their potential impact on the Federal Reserve\u2019s thinking heading into the Federal Open Market Committee\u2019s meeting and interest-rate decision from Sept. 19-20.<\/p>\n What\u2019s Next:<\/strong> On Friday, economists polled by FactSet expect the government to report a gain of 172,500 jobs for August, a slowdown from July\u2019s 187,000 jobs. The unemployment rate is forecast to hold steady at 3.5%, and average hourly earnings are seen rising 0.4% from the prior month, matching July\u2019s pace.<\/p>\n \u2014Nicholas Jasinski, Connor Smith, and Janet H. Cho<\/em><\/em><\/em><\/p>\n The Credit Card Competition Act, aiming to change how credit card transactions are currently processed, could also potentially wipe out the credit cards rewards system, disappointing big spenders who rack up and redeem the most points and those who use points for travel.<\/p>\n What\u2019s Next:<\/strong> TD Cowen doesn\u2019t think Durbin\u2019s efforts will succeed this year, but its Washington analysts recently said risk is rising long-term to the current credit card interchange model as retailers increasingly argue the system benefits big banks and hurts consumers.<\/p>\n \u2014Janet H. Cho and Penta<\/em><\/em><\/p>\n Elon Musk Takes a Self-Driving Spin for Zuckerberg Hunt<\/h2>\n \n Tesla What\u2019s Next:<\/strong> The FSD Beta version isn\u2019t widely available to the public yet. Tesla drivers must first pay for FSD either as a one-time $15,000 payment or as a subscription of up to $199 a month, to request FSD Beta. \u2014Al Root and Janet H. Cho<\/em><\/em><\/em><\/em><\/p>\n Chinese stocks climbed on Monday after the government said it would reduce a tax on trading and take other steps to boost its capital markets.<\/p>\n What\u2019s Next:<\/strong> China\u2019s reforms might not be enough to build long-term confidence from overseas and domestic investors as they watch for the potential fallout from the company\u2019s ailing property sector, which represents 70% of Chinese households\u2019 wealth.<\/p>\n \u2014Adam Clark<\/em><\/em><\/em><\/em><\/p>\n Florida represents two trends that have put American households in the middle: calamitous weather and a rapidly shifting insurance industry. Prices are rising, coverage is shrinking, and bad weather events are more frequent and intense, leaving people scrambling to find affordable coverage for their property.<\/p>\n What\u2019s Next:<\/strong> Tropical Storm Idalia was strengthening in the Gulf of Mexico Sunday, heading for Florida. It is forecast to make landfall as a hurricane as soon as Wednesday. Florida Gov. Ron DeSantis has urged residents to prepare and declared an emergency in 33 counties along the Gulf Coast.<\/p>\n \u2014Lauren Foster and Liz Moyer<\/em><\/em><\/em><\/p>\n***<\/h4>\n
Jobs, Inflation Data to Factor in Next Rate Decision<\/h2>\n
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This Legislation Could End Credit Card Rewards System<\/h2>\n
\n
\n and
\n Mastercard
\n have a near duopoly<\/strong> on such transactions. The legislation proposed by Sen. Dick Durbin (D., Ill.) would open the infrastructure to more payment processors, letting retailers contract with those that charge lower fees. <\/p>\n<\/li>\n***<\/h4>\n
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\n CEO Elon Musk took a self-driving spin in a Tesla through the streets of Palo Alto, Calif., posting a 45-minute video of the journey to his social media platform X, the former Twitter. At one point he joked about finding
\n Meta Platforms
\n CEO Mark Zuckerberg\u2019s house, but he didn\u2019t.<\/p>\n\n
\n Mobileye
\n to provide the \u201cMobileye Chauffeur,\u201d designed to help cars drive themselves<\/strong>, on its Polestar 4, coming in 2025. Mobileye aims for a cost below $6,000 for each car.<\/p>\n<\/li>\n<\/ul>\n
\n General Motors
\n \u2019 Ultra Cruise product is targeting similar capabilities.<\/p>\n***<\/h4>\n
China Cuts Tax on Stock Trading to Boost Market<\/h2>\n
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Catastrophic Weather Is Bearing Down on the Insurance Industry<\/h2>\n
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