Interest Rate Cut Probability Jumps

Here is a daily recap of the S&P 500 broken down by sector followed by sector heat map as interest rate cut probability jumps. Stocks in heat map are based on the top 10 holdings of each sector ETF. Click on each picture to zoom in. Below is a summary of today’s action on Wall Street provided by CNBC:

Dow jumps 260 points, posts best week since November after jobs report spurs rate-cut hopes

Stocks jumped on Friday, building on strong weekly gains, as weak economic data increased the odds of easier monetary policy from the Federal Reserve. The Dow Jones Industrial Average closed 263.28 points higher at 25,983.94, led by gains in Microsoft and Apple. The climbed 1% to 2,873.34 as the tech sector outperformed.

The S&P 500 (SPY) popped +1.05% on Friday. Sector advancers led decliners 9 to 2 as shown below in the sector graph. Communication services (XLC), consumer discretionary (XLY), healthcare (XLV) and technology (XLK) each had gains of 1% or more. Consumer staples (XLP), energy (XLE), industrials (XLI), materials (XLB) and real estate (XLRE) each had minor gains of less than 1%. Financials (XLF) and utilities (XLU) each had small losses of less than 1%.

The Dow Jones index added +263 points (+1.02%) to close at 25,983. The Nasdaq advanced +126 points (+1.66%) to settle at 7,742.

Interest Rate Cut Probability Jumps

Stocks climbed higher on Friday as a disappointing jobs report gave investors hope that the Fed will cut interest rates soon. The US economy only added 75,000 jobs in May, well below an estimated 180,000 jobs. Market expectations of a June rate cut rose to 27% after the jobs report. There is a 79% chance of a July rate cut.

Key Takeaway…

I took the following CNBC screenshot on Friday regarding the wall of worry:

Notable S&P 500 Movers…

Below I’ve highlighted some notable S&P movers (both winners & losers).

Credit: Sector Graph provided by Sector SPDR app. Sector breakdown provided by Charles Schwab. Sector heat map provided by finviz. Information Credit: News Headlines and quotes were taken from CNBC in the writing of this post.

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S&P 500 Sector Graph

Interest Rate Cut Probability Jumps

S&P 500 (SPY)

Interest Rate Cut Probability Jumps

Communication Services (XLC)

Interest Rate Cut Probability Jumps

Consumer Discretionary (XLY)

Interest Rate Cut Probability Jumps

Consumer Staples (XLP)

Interest Rate Cut Probability Jumps

Energy (XLE)

Interest Rate Cut Probability Jumps

Financials (XLF)

Interest Rate Cut Probability Jumps

Real Estate (XLRE)

Interest Rate Cut Probability Jumps

Healthcare (XLV)

Industrials (XLI)

Materials (XLB)

Technology (XLK)

Utilities (XLU)

S&P 500 Sector Heat Map


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