Last week, we saw the market give back a portion of the gains we’ve recently seen, with all of the major indices down between 1.75%-3.5% week-over-week. Part of this is due to the commentary given by Fed Chairman Powell this week, as he reaffirmed the fact that the Fed plans on raising rates two more times this year while testifying before Congress. Powell will be speaking a couple of times this week, so everyone should pay attention to what he has to say and whether or not the message he delivers waivers from recent statements.
While there weren’t many important economic data releases last week, the real mover in the market was Fed Chairman Powell. He has remained confident that the Fed will continue to raise rates at least two more times, which puts quite a damper on the rally we’ve been seeing the past couple of weeks. The Fed is adamant about reaching the target inflation rate of 2%, and Powell seems to think a couple more rate hikes will get us there.
In addition to Fed Chairman Powell’s speeches on Wednesday and Thursday, there will be some important economic data releases to pay attention to this week. We’ll get to hear some important housing data, with new home sales on Tuesday and Pending home sales on Thursday. These metrics will give us an idea of how the housing market is performing and whether or not it continues to weather the “interest rate storm” it’s been enduring. Additionally, we’ll get PCE data as well as personal spending and income data on Friday. PCE is always important to pay attention to, as it’s the Fed’s preferred inflation metric. Whereas personal spending and income data will give us an idea of how the consumer is fairing.
This week should be one of the final weeks of the earnings season slowdown, as it’s the last week of Q2! This week, we’ll hear from:
06/26 – Carnival Corporation (CUK/CCL)
06/27 – Walgreens Boots Alliance (WBA), Jefferies Financial Group (JEF)
06/28 – Micron Technology (MU), General Mills (GIS)
06/29 – Nike (NKE), Paychex (PAYX), McCormick & Company (MKC)
We’ll start the week by hearing from CCL, which should give us a good idea of how the travel sector is performing and whether or not consumers still have a good chunk of disposable income.
We’ll also get to hear from NKE, which will be another great indicator of the consumer’s financial health. Depending on the results and guidance that NKE provides, we will likely see other clothing and lifestyle brands, like LULU, ADS, UA, and ONON, make moves as well!
Lastly, MU will be the first semiconductor company to report earnings this quarter. Depending on the guidance they provide, we’ll likely see some major movements in other semiconductor companies, like TSM, NVDA, AMD, and more.
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