As we progress into the second week of July, the financial markets are on high alert for Federal Reserve Chair Jerome Powell’s testimony regarding the economic outlook and recent monetary policy actions. His insights will be crucial in shaping market expectations and guiding investor sentiment amid the ongoing bullish run that has propelled the S&P 500 and Nasdaq indices to record highs.
Following Powell’s testimony, market participants will turn their attention to a series of key economic data releases that are expected to provide a clearer picture of the US economy’s health. The US core inflation rate for June is anticipated to rise by 0.2% month-on-month (m-o-m), with the overall inflation rate for June expected to increase by 0.1% m-o-m. These figures will be closely monitored as they could influence future monetary policy decisions.
Additionally, the Producer Price Index (PPI) for June is projected to show a modest 0.1% increase m-o-m, rebounding from a decline in May. The preliminary Michigan Consumer Sentiment Index for July will also be released, with June’s revision seeing an uptick to 68.2, reflecting improved consumer confidence in the US economy.
Further macroeconomic indicators include the 10-year note and 30-year bond auctions, which will provide insights into investor demand for US government debt. Updates on Consumer Credit changes for May, the NFIB Optimism Index for June, Wholesale Inventories for May, weekly Initial Jobless Claims, and the US Federal Budget for June will offer additional perspectives on economic health and consumer behavior.
Amid these economic developments, investors will also be closely watching earnings reports from major corporations. Among earnings reports expected this week, PepsiCo Inc. (NASDAQ: PEP) is one to note. The group had forecast of a minimum 4% increase in organic revenue and a targeted core earnings per share (EPS) of at least US$8.15 for the full year 2024.
Similarly, Cintas Corporation (NASDAQ: CTAS) has delivered robust results, with Cintas upgrading its fiscal year 2024 revenue outlook to a range between US$9.57 billion and US$9.60 billion following a strong third-quarter performance.
Investors will also be keenly awaiting updates from major financial institutions including JPMorgan Chase & Co. (NYSE: JPM), Wells Fargo & Co (NYSE: WFC), Citigroup Inc (NYSE:C), and Bank of New York Mellon (NYSE:BK). These updates are expected to provide insights into the health of the banking sector.
With market indices at historic highs, investors are positioned to monitor fresh corporate earnings, new economic indicators, and Federal Reserve communications to navigate the evolving landscape of the US financial markets in the week ahead. Stay tuned as these developments unfold and influence market sentiment and investment strategies moving forward.
Disclaimer: ProsperUs Manager of Content Hailey Chung doesn’t own shares of any mentioned companies.
