Last week, we saw continued life in the IPO market as Instacart was listed on the Nasdaq exchange under ticker CART. Although this might suggest that the markets are turning around, we saw a tremendous amount of red in the market last week, with all major indices down between 1.5% and 3.75% on a week-over-week basis. Recession fears are growing, and it doesn’t seem that the Fed will cut interest rates anytime soon.
Last week, the Fed came out with its interest rate decision, and to no one’s surprise, they did not hike rates. However, they did maintain a hawkish position, emphasizing that they were not done hiking rates and their commitment to a steady inflation rate of 2%. In other news, we’re seeing some key housing metrics beginning to falter, as the home builder confidence index sank to 45, versus an expected 49.5 and a previous reading of 50. We also saw a relatively large miss in housing starts, which came in at 1.28 million for the month of August, versus an expected 1.43 million and a previous reading of 1.45 million.
This week, we’ll see some very important economic data releases, starting with new home sales on Tuesday. This will help give us an idea of how the housing market is doing amidst the incredibly high interest rates we’re seeing right now. On Thursday, we’ll get to see the revised Q2 GDP numbers, and on Friday, we will see information on personal income and spending, as well as the Fed’s preferred inflation metric, PCE. The GDP and PCE data releases will be particularly important, as these are both metrics that are tracked by the Fed.
This week, we see a bit of noteworthy activity in terms of earnings releases, with the following companies reporting their earnings:
09/26 – Costco Wholesale Corporation (COST), Cintas Corporation (CTAS), Ferguson plc (FERG)
09/27 – Micron Technology, Inc. (MU), Paychex, Inc. (PAYX), Jefferies Financial Group (JEF)
09/28 – Accenture PLC (ACN), Nike, Inc. (NKE), Jabil Inc. (JBL), CarMax (KMX), Vail Resorts, Inc. (MTN)
09/29 – Carnival Corporation (CCL/CUK)
It’ll be particularly important to pay attention to COST, NKE, KMX, MTN, and CCL. Earnings reports from COST, NKE, and KMX will give us a good idea of where the consumer is spending their money in terms of goods, and MTN and CCL will give us an idea of whether or not consumers are looking to spend on travel and experiences.
You should also be on the lookout for what MU has to say about demand and the progress being made in terms of onshoring their manufacturing. Their earnings report should also give us a good idea of what we can expect from the rest of the chip makers and manufacturers this earnings season.
Monitoring the market conditions this week.
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