✂️ The Fed Is Getting Ready To...?

Good morning. US stock futures rose in Thursday morning trading as investors looked ahead to commentary from Federal Reserve Chair Jerome Powell expected later this week.

✂️ Fed officials hint at upcoming rate cut

📝 Our report: Most Federal Reserve officials agreed last month they’d likely cut interest rates in September—if inflation stays on its best behavior. The recently released minutes of the Fed’s July 30-31 meeting said the “vast majority" of policymakers “observed that, if the data continued to come in about as expected, it would likely be appropriate to ease policy at the next meeting.”

 🔑 Key points:

• In July, the policymakers kept their benchmark rate at 5.3%, a near-quarter-century high, where it's stood for more than a year.

• Wall Street traders had already considered it a certainty that the Fed will announce its first interest rate cut in four years when it meets in mid-September.

• A rate cut in September, coming less than two months before the presidential election, could bring some unwelcome political heat on the Fed, which seeks to avoid becoming entangled in election-year politics. Former President Donald Trump has argued that the Fed shouldn’t cut rates so close to an election.

💡 So what: If the Federal Reserve cuts interest rates at its September meeting, markets could see a rally in stocks as cheaper borrowing boosts consumer spending and business investment, while bond yields may drop due to lower expected returns. The U.S. dollar could weaken, making exports more competitive and driving up commodity prices like oil and gold. Increased consumer confidence might follow, though this could also raise inflation concerns, leading to mixed market reactions and potential volatility as investors reassess the economic outlook.

Thursday - Initial Jobless Claims

Friday - Fed Chair Jerome Powell Speech at Jackson Hole Retreat

📈 Investing legend Paul Tudor Jones shares these 10 tips on risk management

💳 The difference between a personal loan vs. a personal line of credit

🥱 Are you a procrastinator? Here’s how you can kick the habit!

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🤖 OpenAI speaks out against Cali AI bill

WHAT: OpenAI is pushing back against a California bill that would impose new safety rules on AI companies, joining the growing crowd of tech leaders saying, “Not so fast!”. The San Francisco-based startup said the bill would hurt innovation in the AI industry and argued that regulation on this issue should come from the federal government instead of the states, according to a letter sent to California State Senator Scott Wiener’s office.

WHY: The bill, which passed the state Senate in May, would require AI companies to take steps to prevent their models from causing “critical harm,” such as enabling the development of bioweapons that can cause mass human casualties or by contributing to more than $500 million in financial damage.

🧾 “Big 4” accounting firm braces for ban in China

WHAT: PwC China told clients it expects a six-month business ban starting in September, courtesy of Chinese authorities, as a penalty for its audit of failed property developer Evergrande. The ban would prevent it from signing off on financial results and initial public offerings and from conducting other regulated activities, the report stated, citing multiple clients.

WHY: As of March, PwC was the leading auditing firm in China with about 110 companies listed in the country as its clients. Since then, at least 50 Chinese companies, many of which are state-owned firms or financial institutions, have dropped PwC as its auditor or cancelled the plans to hire it in recent months.

📽️ Bronfman sweetens deal for Paramount

WHAT: Who says you can't buy a little more entertainment? Media mogul Edgar Bronfman just upped his bid to $6 billion for National Amusements and a slice of Paramount Global. The competing offer for the home of Paramount Pictures, the CBS broadcast network and cable networks such as MTV threatens to undo a planned acquisition by tech scion David Ellison and his firm Skydance Media. Bronfman had previously offered $4.3 billion, according to Reuters sources.

WHY: Skydance and National Amusements had agreed to a 45-day go-shop period, which is set to end this week that allowed Paramount to solicit and consider other offers. A special committee of the Paramount board agreed to extend the deadline to give it time to evaluate the new bid, according to the New York Times.

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