Big winners after a rate cut | Wall Street’s next battleground?

Big winners after a rate cut | Wall Street’s next battleground? | Ryanair CEO rips Boeing

MON, JUL 29, 2019

EVENING BRIEF

AS OF MON, JUL 29, 2019 • 04:00 ET

DJIA		27218.71
		+0.10%	+26.26

S&P 500		3020.78
		-0.17%	-5.08

NASDAQ		8293.33
		-0.44%	-36.88

Most Active

DOW
NAME	LAST	CHG	%CHG
PFE	41.45	-1.64	-3.81%
AAPL	209.68	+1.94	+0.93%
INTC	52.51	+0.92	+1.78%

S&P 500
NAME	LAST	CHG	%CHG
MYL	20.78	+2.32	+12.57%
PFE	41.45	-1.64	-3.81%
AMD	33.48	-0.54	-1.59%

NASDAQ
NAME	LAST	CHG	%CHG
MYL	20.78	+2.32	+12.57%
AMD	33.48	-0.54	-1.59%
SIRI	6.16	-0.06	-0.96%

EDITOR'S NOTE

Wall Street is laser-focused on the expected "insurance" rate cut this week, which would be the first reduction since the financial crisis by the Federal Reserve.

For traders looking to make the most of the easing cycle, CNBC's Yun Li looked at the top-performing sectors in the six months after the first Fed rate cut in each cycle going back to 1990. Based on the CNBC analysis using Kensho, a hedge fund analytics tool, materials and industrials both returned nearly 9% on average as cyclical sectors tend to react quickly to lower rates and expectations for them to jolt the economy. The consumer sector also did well, since lower borrowing costs tend to spur spending. The overall market climbs just over 4%, on average, in the six months after an initial cut.

But if what's past is prologue, tech is one sector to avoid after a Fed rate reduction. The S&P 500 information technology sector has been flat even when the central bank embraced easy money. Noncyclical utilities didn't get much of a boost from past rate cuts, while communication services, health care and financials were also among the worst-performing sectors.

Meanwhile, investors have been moving to companies with more debt as they get ready for the expected interest rate cut. U.S. companies are on pace to break another record for share repurchases in 2019, using a combination of cash and debt to push the total to close to $1 trillion, CNBC's Jeff Cox writes, citing Goldman Sachs calculations.

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