Fed Cuts Rates By Half Point; Intel-Nvidia Merger Talks?

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The Federal Reserve slashed interest rates by a half percentage point, exceeding expectations. Meanwhile, rumors swirl about a potential merger between tech giants Intel and Nvidia.

This report is from today's CNBC Daily Open, our international markets newsletter. CNBC Daily Open brings investors up to speed on everything they need to know, no matter where they are. Like what you see? You can subscribe. Whether talks proceeded or what possible deal terms would be are unclear, according to a source. Considering Intel's market cap of over $90 billion, the deal, if it were to happen, would be one of the largest technology mergers ever.

The freight company's seen as a bellwether for the economy. The higher overall demand is, the more shipping services are required. Hence, when FedEx misses revenue estimates, one possible conclusion's that the economy's not doing as hot as expected.Piper Sandler chief global economist Nancy Lazar noted the current easing cycle echoes that of 2001 and 2007, when the Fed's first cut was also half a percentage point.

"On average, it takes 10 quarters after rate liftoff for a downturn to commence. This is the 10th quarter. And given the size of the rate hikes, and the Fed's balance sheet drawdown, joblessness could reach 6%," wrote Lazar. In terms of financial markets, financial firm BTIG sees a possible pullback. But it's optimistic"the weakness likely to be more moderate than we initially thought," noted chief market technician Jonathan Krinsky.eked out a 0.09% increase for a new closing high. All three indexes also ended the week in the green.

Last week's burst of euphoria was mostly driven by anticipation and celebration of the Fed's rate cut. Markets this week will look at the, like the preliminary measure of PMI, consumer confidence and PCE report.

 

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