Market Eagerly Awaits Inflation Numbers
In terms of meaningful economic report data, we expect an eventful week. However, the releases are concentrated mid- to late-week, and there are none to speak of today or tomorrow — nor are there any public appearances by Fed presidents or governors, as they respect the “blackout period” ahead of next week’s Federal Open Market Committee (FOMC) meeting, at which time they will decide whether or not to raise interest rates for a 12th time since St Patrick’s Day of 2022.
This week, it’s the all-important Consumer Price Index (CPI) report out on Wednesday, and its companion piece, the Producer Price Index (PPI), on Thursday. Both indices will be for the month of August. Last time out, core CPI — stripping out volatile food and energy prices — came in at 4.7%, its lowest print since October 2021 (back when the Fed was still calling inflation “transitory”). Meanwhile, core PPI matched its previous month’s 2.4% — the closest of any economic metrics have yet come to the Fed’s optimal 2% inflation goal.
In addition, this week also brings us August tallies on Retail Sales, Import Prices, Consumer Sentiment and Industrial Production/Capacity Utilization. Business Inventories for July and a fresh Empire State manufacturing survey for September also await us. These will be most of the final data the Fed takes into account ahead of next week’s meeting, which begins a week from tomorrow and concludes the following day, ending with a press conference featuring Fed Chair Jay Powell. It is this event most likely to impact the near-term markets, which turned up last Friday following a difficult week across most major indices.
After today’s close, we’ll see new earnings results from Oracle ORCL, the tech major riding a three-quarter earnings winning streak. Fiscal Q1 numbers are expected to show earnings growth north of +10%, with revenues +8.8%. Yet some downward revisions in coverage for the full fiscal year have saddled the enterprise software giant with a Zacks Rank #4 (Sell) ahead of the release. The company has only missed earnings expectations twice in the past five years.
Pre-market futures are up at this hour, following a Friday trading session where only the small-cap Russell 2000 closed lower. This morning, we see the Dow +0.18%, the S&P 500 +0.50%, the Nasdaq +0.77% and the Russell +0.60%. Tesla TSLA is providing an assist to both the Nasdaq and S&P this morning on an upgrade from Morgan Stanley ahead of the bell. Shares are +6.6% currently, and still up a whopping +130% year to date.
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