The market is awaiting US inflation data this week and Powell’s remarks to the US Congress. There is growing belief that rates will fall in September.
Two of Wall Street’s major indexes hit new record highs on Mondayamid growing confidence that rates will begin to be cut in September. The market is looking ahead to a key inflation report this week, testimony before Congress by Federal Reserve Chairman Jerome Powell, and the start of earnings season this week.
He S&P trose 0.1% to 5,572.15 units, while the technological benchmark Nasdaq advances 0.3% to 18,410 points, both being new records. For its part, the industrial sector Dow Jones erases its initial gain and shows a decrease of 0.1% to stand at 39,347.45 units.
The chip stocks such as Nvidia, Intel, Marvell Technology, Advanced Micro Devices and Qualcomm climbed between 1% and 5% in early trading, helping the Philadelphia Semiconductor Index SE gain 2%.
Expectations of rate cuts as early as September received a boost after Friday’s nonfarm payrolls report showed U.S. job growth slowed in June, the latest data pointing to weaker labor market conditions.
However, investors will be looking for a clearer picture of the likely path of the Federal Reserve’s monetary policy for the rest of the year.
Traders now see a 74% chance of a 25 basis point cut in September, up from 60% last week, while expecting an overall reduction of about 50 basis points for the year, according to FedWatch data from CME and LSEG.
On the other hand, this week we will follow the data of the consumer price indexes and the producer to gauge whether inflationary pressures are easing.
In parallel, major banks such as Citigroup, JPMorgan Chase and Wells Fargo are scheduled to present their results on Friday. second quarter results.
Source: Ambito
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