Aptiv plc manufactures and sells vehicle components worldwide. It has two segments, Signal and Power Solutions, and Advanced Safety and User Experience. The company has 141,000 employees. The shares are a component of the S&P 500.

Monday Tee Up: Rate Cut Odds Go Up This week, Wall Street will focus on earnings reports, the health of the U.S. economy, and when (and by how much) the Fed will cut interest rates. Odds of a 50-basis-point (bps) cut at the next rate meeting in September have spiked. This follows the weaker-than-expected jobs report from last week. The Dow Jones Industrial Average ended last week down 2.1%, the S&P 500 lost 2.1%, and the Nasdaq fell 3.4%. Year to date, the Dow is higher by 5% and both the S&P 500 and the Nasdaq are up 12%. On the economic calendar, the schedule is light this week. On Tuesday, the U.S. Trade Deficit will be reported. On Wednesday, Consumer Credit hits the tape. On the earnings calendar, Tyson Foods reports on Monday. On Tuesday, Airbnb, Uber, Yum! Brands, Caterpillar, Amgen, and Duke Energy. On Wednesday, Disney, CVS Health, Hilton, and McKesson. On Thursday, Eli Lilly, Paramount Global, Expedia, and Take-Two Interactive. And on Friday, AMC Networks. Earnings have been coming in 12.9% higher this quarter than a year ago. Some 75% of S&P 500 companies have reported so far. Expectations are for 8%-12% earnings growth for 2Q. This follows 8% growth in 1Q and 10% in 4Q23. At Argus, we forecast EPS growth for all of 2024 at 8%-9%. Last week, the Federal Reserve left interest rates unchanged, as expected. But that decision and Chairman Powell's press conference were completely overshadowed by the subsequent July jobs report. Nonfarm Payrolls surprised on the downside at 114, 000 new jobs, compared to a revised-lower 179,000 the in June. The Unemployment Rate surprised to the upside, hitting 4.3% for July versus the expected 4.1%. This prompted worries that the labor market is cooling too quickly, and speculation that the Fed has waited too long to cut interest rates -- possibly imperiling a desired soft landing. Mortgage rates fell to 6.73% for the average 30-year fixed-rate mortgage. Gas prices went up a penny, to $3.48 per gallon for the average price of regular gas. The Atlanta Fed GDPNow indicator is forecasting for 3Q and calls for expansion of 2.5%. The Cleveland Fed CPINow indicator forecasts 3.01% for July CPI. Looking ahead, the next Fed rate decision is on September 18, with odds at 100% for a rate cut. Of that, 20% expect a 25-bps cut, which compares to 88% last week before the jobs number came out. But of greater interest is that the odds are now at 80% that there will be a 50-bps cut (compared to 11% who felt that way last week). There are two more Fed rate meetings this year, on November 7 (two days after the U.S. presidential election) and December 18. We are standing by our call that the Fed will cut interest rates twice this year and twice in 2025.

Aptiv plc manufactures and sells vehicle components worldwide. It has two segments, Signal and Power Solutions, and Advanced Safety and User Experience. The company has 141,000 employees. The shares are a component of the S&P 500.

Monday Tee Up: Fed Week