• Dow Jones clips into higher ground as investors look to claw back territory.
• US Retail Sales to be the early week’s key data print.
• Investors shrug off increasing warnings from Fed policymakers to hope for cuts.

The Dow Jones Industrial Average (DJIA) found thin gains on Monday, climbing four-tenths of a percent as investors recover balance and resume the long wait for rate cuts from the Federal Reserve (Fed). The “bad news is good news” narrative that has fueled investor sentiment seeking an accelerated pace of rate cuts from the Fed still exists in broader market flows, but has begun to destabilize as US economic data begins to cool faster than expected.

The Fed is still firmly entrenched in a holding pattern as policymakers seek firmer signs of cooling inflation within the US’ domestic economy as shelter and services inflation thumbs the nose at market expectations. Despite repetition of the need for patience from Fed officials, markets continue to hope for a quarter-point cut from the Fed at the September 18 policy meeting. According to the CME’s FedWatch tool, rate traders are pricing in over 60% odds of at least a 25 basis point rate trim from the Fed in September.