Get Ready for a Packed Week in the Financial Markets: Key Inflation Data, Fed Chair Testimony, and Earnings Season Kick Off
By Lisa Pauline Mattackal
U.S. stock index futures are holding steady as investors await important events this week, including a crucial inflation reading, Congressional testimony from Federal Reserve Chair Jerome Powell, and the beginning of earnings season. The latest nonfarm payrolls report, which showed a slowdown in U.S. job growth, has increased expectations of interest-rate cuts as early as September.
Market participants are eagerly looking for signals on the Fed's monetary policy direction for the rest of the year. Current projections suggest a 69% chance of a 25-basis-point cut at the September meeting, with expectations of a total cut of around 50 bps for the year.
This week, all eyes will be on Thursday's release of June's consumer price index data to gauge whether price pressures are easing. U.S. headline inflation is expected to show a slight increase of 0.1% on a monthly basis, while core inflation is anticipated to rise by 0.2%.
The S&P 500 and the Nasdaq reached new all-time highs on Friday, driven by megacap tech stocks like Meta Platforms and Microsoft. However, Tesla shares dipped slightly in premarket trading, while Nvidia saw a modest gain.
The upcoming earnings season, starting with major banks like Citigroup, JPMorgan Chase, and Wells Fargo, will play a crucial role in shaping equity sentiment for the rest of the year. Investors will be closely monitoring corporate earnings to assess whether the impressive performance of a few megacap stocks justifies their lofty valuations.
Federal Reserve Chair Jerome Powell's testimony before Congress and comments from other Fed officials throughout the week will also be closely watched by the markets. At the opening bell, stock index futures are showing a mixed trend.
Paramount Global surged after announcing a merger with Skydance Media, while Boeing saw a slight uptick after agreeing to plead guilty to a criminal fraud conspiracy charge related to the 737 MAX crashes.
Stay tuned for more updates as the week unfolds, with a focus on the latest market developments and their potential impact on your investments and financial well-being.