Economic Data Signals and Fed Decisions Explained

In a recent discussion, Amanda Agatti, Chief Investment Officer at PNC Asset Management Group, provided insights into current market dynamics and economic data. Describing the economic landscape as 'late innings of the cycle', she emphasized the mixed signals impacting investor sentiment and Federal Reserve decisions. Agatti predicts a 25 basis point rate change from the Fed, contingent upon upcoming job report data, stating that one data point alone is not definitive enough to shift trends or force the Fed's hand. The corporate earnings outlook remains cautious as Q3 expectations appear lackluster, reflecting negative revisions from the previous quarter — a situation further complicated by a looming significant electoral year. Agatti encourages investors to seek quality opportunities in both equity and fixed income, while highlighting that US equities remain attractive compared to international markets. Despite a cautious tone, she believes that potential market moves hinge on future news and earnings improvements, particularly in small and mid-cap sectors.