What Happened?
Shares of financial advisory firm Perella Weinberg Partners (NASDAQ:PWP) jumped 3.8% in the afternoon session after reports indicated the investment advisory firm was hired by British money manager Schroders to advise on a potential sale of its financial planning business, Benchmark Capital. Schroders, a major asset manager in the U.K., was reportedly exploring various options for its Benchmark Capital unit, including a possible sale, after receiving interest from private equity firms. The selection of Perella Weinberg Partners for this advisory role represented a significant new business engagement. Such roles typically involved substantial fees, which could positively affect the firm's revenue. The news signaled confidence in Perella Weinberg's expertise in handling large transactions, leading to a positive reaction from investors.
After the initial pop the shares cooled down to $18.26, up 3.6% from previous close.
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What Is The Market Telling Us
Perella Weinberg’s shares are very volatile and have had 22 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 12 days ago when the stock gained 5.6% on the news that investors grew more optimistic about a potential Federal Reserve interest rate cut in December.
The positive sentiment was fueled by comments from New York Fed President John Williams, a voting member of the rate-setting Federal Open Market Committee, who stated the central bank could cut rates "in the near term" without jeopardizing its inflation targets. Following his remarks, market expectations for a rate cut in December shifted significantly. According to the CME FedWatch Tool, the probability of a December rate reduction surged from a 37% chance earlier in the day to 70%. While lower rates can compress bank profit margins, investors often view them as a catalyst for broader economic activity, potentially boosting loan demand and reducing the risk of defaults.
Perella Weinberg is down 22.5% since the beginning of the year, and at $18.26 per share, it is trading 30.9% below its 52-week high of $26.41 from January 2025. Investors who bought $1,000 worth of Perella Weinberg’s shares 5 years ago would now be looking at an investment worth $1,785.
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