The Dividend Cafe Thursday - August 1, 2024
The Dividend Cafe
The Dividend Cafe - The Bahnsen Group
4.9 • 572 Ratings
🗓️ 1 August 2024
⏱️ 5 minutes
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Summary
Market Volatility and Economic Data Insights – August 1st Update
In this episode of Dividend Cafe, Brian Szytel from the Newport Beach office discusses the substantial market movements on August 1st. Following a significant rally, there was a notable sell-off with the Dow down 494 points, S&P falling by 1.3%, and NASDAQ declining by 2.3%. The 10-year yield dropped below 4%, and the VIX rose to 19, indicating increased market volatility. Seitel highlights recent economic data, including weaker-than-expected ISM manufacturing data and high jobless claims, portraying a cooling employment market. He also previews upcoming non-farm payrolls and emphasized the importance of understanding daily market fluctuations in the context of broader economic trends.
00:00 Introduction and Market Overview
00:24 Market Reversal and Bond Yields
01:13 Economic Data and Market Reaction
02:01 Employment Data and Fed's Mandate
02:49 Conclusion and Upcoming Events
Links mentioned in this episode: DividendCafe.com TheBahnsenGroup.com
Transcript
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| 0:00.0 | Welcome to the Dividing Cafe weekly market commentary focused on dividends in your portfolio and dividends in your understanding of economic life. |
| 0:10.0 | Welcome to Dividendon Cafe this Thursday, August 1st, Brian Saitel with you here from Newport Beach office. |
| 0:18.0 | And what one day giveth, another taketh away. So after yesterday's |
| 0:23.3 | big rally, we had a big, decent sell-off at least today. That was down 494 points. S&P was down |
| 0:30.2 | 1.3 percent, NASDAQ, sold off the most, down 2.3%. So basically a reverse, partial reversal of |
| 0:37.0 | yesterday. The yields continue to |
| 0:38.9 | plummet with bonds rallying. 10-year yield broke 4%. We're at 398. We're actually below 398 earlier in |
| 0:46.7 | the year, but still, we haven't seen a three handle here in some time, six months or five months or so. |
| 0:51.6 | The volatility index, the VIX was up to 19. That's about the highs that we saw |
| 0:57.5 | last April. If you remember earlier in the year, I'm sorry, this April, if you remember earlier in |
| 1:02.3 | the year, we had interest rates, price and really a whole lot of cuts in the beginning of the |
| 1:07.0 | year and markets rallied on that. And then as rates went, 10-year went from about 385 to |
| 1:11.5 | 485 from February to April, we had markets sell off quite a bit then. And this is about this |
| 1:17.4 | similar amount of volatility is what's priced in on the VIX. So basically, you've got the script |
| 1:22.2 | flipped back to what is more normal, frankly. It's bad news is bad news. We had some weaker economic |
| 1:27.4 | data, and so you had bonds rally and stock sell off. |
| 1:30.3 | That's a normal dichotomy. |
| 1:31.3 | What we've seen lately is more lower rates just being the sort of punch bowl at the market party |
| 1:37.3 | and lifting everything and that reversed today. |
| 1:39.3 | So fundamentals will outweigh yesterday's Fed talk, real fundamentals from the day, |
| 1:47.1 | current fundamentals. And what we got was some manufacturing data on ISM for the month that was |
| 1:53.4 | in contractionary territory and lower than what was expected. And then we had initial jobless |
... |
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