CNBC Business News Update - Market Close: Rate Cut Rally Sends Stocks Higher, Fed Indicates Its Time To Cut Interest Rates, Real Estate Sees Boost Coming 8/23/24

Episode Date: August 23, 2024

From Wall Street to Main Street, the latest on the markets and what it means for your money. Updated regularly on weekdays, featuring CNBC expert analysis and sound from top business newsmakers. Anchored and reported by CNBC's Jessica Ettinger.

I'm Jessica Edinger, CNBC. Wall Street opens Monday morning after a Friday rate cut rally. The Fed chair said it's time to cut interest rates. The Dow was up 462 points above 41,000, very close to a record high, up more than 1%. The S&P 500 index up 63 points. That's above 5,600 again and it was up more than one percent. The Nasdaq soaring 258 points, almost one and a half percent. It was just a bit of tension release. Clearly there was at least enough suspense going into the Jackson Hole speech by

Powell in terms of what he was going to say and how he was going to say it and that there was a little bit of pressure taken off. CNBC's Mike Santoli, companies whose shares hit fresh all-time highs on Friday include Discounter Raw Stores, Colgate-Palmolive, Berkshire Hathaway Class B and J.P. Morgan. Federal Reserve Chairman Jay Powell clearly said interest rates can come down now that inflation is so close to target. The economy continues to grow at a solid pace, but the inflation and labor market data show an evolving situation. The upside risks to inflation have diminished and the downside risks to employment have increased. The time has come for policy to adjust. The direction of travel is clear and the timing and pace of rate cuts will depend on incoming data, the evolving outlook, and the balance of risks.

Fed Chair Jay Powell at the Jackson Hole Economic Summit, as heard on CNBC. Some investors say, yes, the markets are high, but interest rate cuts have a lot of positives to keep that going. The cost of business coming down, the cost of labor coming down. If you get a housing cycle because they take the 30-year down to 5% instead of 7%, what does that mean for the economy and what are the gains in corporate profits as a result of that? Ritholtz Welts, Josh Brown on CNBC. Newly built home sales popped by more than 10% last month. The biggest sales jump in two years. Home builders like D.R. Horton and Lenar saw their shares hit record highs on Friday. Interest rate cuts could

greatly help the anemic residential real estate market, which has slowed to a crawl for two years. Rate cuts and a more dovish spread will definitely be a boost for housing because that does get you in a sub 6% market to have sustained growth in the existing home sales market. Mortgage rates probably have to be 6% and having it stay there. Housing Wires' Logan Motoshami on CNBC. Facebook parent Meta canceled its high-end mixed reality headset. A device it thought would be a big hit just didn't catch on. On the coming week's watch list, earnings

from retail names like Nordstrom, Best Buy, and Gap. We also hear from Salesforce, HP, CrowdStrike, and Affirm. We also get results from a biggie on Wednesday, AI chipmaker NVIDIA. Economic data in the coming week include the latest measure of home prices with the Case-Shiller Home Price Index, durable goods orders for July, plus we get a fresh read on consumer confidence. U.S. Open Tennis begins on Monday. And on Monday, Olive Garden brings back the never-ending pasta bowl for 14 bucks, same price as it was two years ago. Jessica Ettinger, CNBC. How did a master cyber criminal and a Russian oligarch with ties to the Kremlin hack into America's financial system, scamming millions?

CNBC presents The Crimes of Putin's Traitor. Listen wherever you get your podcasts.