Dow and S&P 500 Hit Record Highs

Stocks pushed to fresh records as rate-cut bets firmed, even as a U.S. government shutdown clouded near-term data visibility and weighed on the dollar. Flows favored equities and rate-sensitive sectors on growing expectations of a near-term Fed cut.

TL;DR:

📈 Global equity funds see 11-month inflows
🏦 BofA sees October Fed rate cut
💵 Dollar slides amid shutdown, data delays
📊 Dow and S&P hit record highs

Global Equity Funds See 11-Month Inflows

Risk appetite accelerated as global equity funds took in a net $49.19 billion, the largest in 11 months, with investors leaning into the prospect of Federal Reserve rate cuts. The pickup in flows supported equities broadly and helped steady credit sentiment into the weekend. Source

BofA Sees October Fed Rate Cut

Bank of America pulled forward its Fed call, forecasting a rate cut in October rather than December, citing signs of a weakening labor market. The shift reinforced expectations for easier policy, supporting duration, rate-sensitive equities, and a softer front end in yields. Source

Dollar Slides Amid Shutdown, Data Delays

The U.S. dollar extended multi-week losses as the government shutdown delayed key economic releases, muddying the Fed’s near-term read on the economy. Reduced data visibility and rising cut odds pressured the greenback while traders weighed BOJ dynamics and broader election implications. Source