The S&P 500 rebounded last week amid growing signs that inflation was easing ahead of the Federal Reserve’s next interest-rate decision scheduled for later this month, while JPMorgan Chase (JPM) and Wells Fargo’s (WFC) Q2 results topped Wall Street’s views.
All sectors notched gains for the week, led by communication services’ 3.4% increase and consumer discretionary’s 3.3% rise. Technology, real estate, materials, utilities, industrials and health care rose more than 2% each. Financials saw a roughly 2% increase, while consumer staples and energy advanced 1.2% and 0.6%, respectively.
Official data released during the week showed annual consumer inflation in the US cooled for the 12th consecutive month in June, while producer prices eased more than projected, signaling continued improvement in inflation. Still, markets are widely expecting the Federal Open Market Committee to increase its benchmark lending rate by 25 basis points on July 26.
Following 10 consecutive hikes, the FOMC left interest rates unchanged at 5% to 5.25% in June, saying the move would allow it “to assess additional information and its implications for monetary policy.” However, minutes from the June meeting released earlier this month showed that almost all participants “judged that additional increases in the target federal funds rate during 2023 would be appropriate.”
In energy news, the International Energy Agency lowered its 2023 global oil demand growth forecast, citing “persistent” macro challenges, while the Organization of the Petroleum Exporting Countries raised its outlook amid higher use in China.
Some of the major earnings scheduled for this week include Goldman Sachs (GS), PNC Financial Services (PNC), Morgan Stanley (MS), Bank of America (BAC), Bank of New York Mellon (BK), U.S. Bancorp (USB), Netflix (NFLX) and Tesla (TSLA). American Express (AXP), Lockheed Martin (LMT), Prologis (PLD), Johnson & Johnson (JNJ), United Airlines (UAL) and American Airlines (AAL) also report this week.
On the economic front, this week’s calendar includes the retail sales and industrial production reports for June, the housing starts and existing-home sales data for last month, as well as the July regional manufacturing reports from the New York and Philadelphia Feds.
Get instructions on how to enable our Flash News Briefing skill to your Amazon devices:
Episode 164 – How Families Can Balance Paying For College And Saving For Retirement