Market Watch: BOE Policy, Tech Stocks, and Tesla’s EU Sales Surge.

Market Watch: Dow futures contract rose by 0.1%, S&P 500 futures rose by 0.4%, and Nasdaq 100 futures rose by 0.7%.

Tech stocks are expected to boost Wall Street, with Nvidia leading the way. Bank of England is expected to maintain interest rates, while Swiss National Bank cuts rates.

Nvidia at top

Nvidia, the world’s most valuable company, is likely to remain in the spotlight after becoming the world’s most valuable company. Its price target for Nvidia’s shares has been lifted to $165 from $114, citing its long-term growth prospects and profitability metrics. Analysts at Stifel raised their price target to $165, citing opportunities in high-performance computing, hyperscale and cloud data center, and enterprise and edge computing.

BOE hold rate

The Bank of England is set to hold interest rates unchanged in its latest policy meeting. UK inflation reached its 2% target in May, but wage growth and pricing pressure remain concerns. Governor Andrew Bailey opened the door to a rate cut, but markets see only a 30% chance of an August cut. The Swiss National Bank also trimmed its key interest rate.

Tesla’s EU sales fell

Tesla’s EU sales fell 34.2% in May due to a drop in demand for new battery-electric cars. The European Commission’s provisional duties on China-made EVs, aimed at protecting domestic automakers from cheap imports, have prompted Tesla to increase its China-made Model 3 price. Total EV sales in the EU dropped 12% from the previous year, with Germany experiencing a 30% reduction.

Economic Calendar

• 8:30 Housing Starts and Permits
• 8:30 Initial Jobless Claims
• 8:30 Philly Fed Manufacturing Index
• 8:30 Current Account
• 8:45 Fed’s Kashkari Speech
• 10:00 Atlanta Fed’s Business Inflation Expectations
• 11:00 EIA Petroleum Inventories
• 4:00 PM Fed’s Barkin Speech
• 4:30 PM Fed Balance Sheet
• 10:15 PM Fed’s Daly Speech

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Recent data indicating a possible cooling in the U.S. economy have alleviated some persistent inflation concerns, fueling hopes that the Federal Reserve will start to bring interest rates down from more than two-decade highs as soon as September. Along with the Dow, the benchmark  and tech-heavytouched record marks last week.

The durability of the strength on Wall Street will likely be tested by a fresh batch of corporate results this week, including quarterly returns from artificial intelligence darling Nvidia (see below). Durable goods and consumer sentiment data will also be in focus as markets hunt for more evidence that growth is moderating enough to give the Fed justification for rolling out rate cuts this year.

Recent data indicating a possible cooling in the U.S. economy have alleviated some persistent inflation concerns, fueling hopes that the Federal Reserve will start to bring interest rates down from more than two-decade highs as soon as September. Along with the Dow,

The durability of the strength on Wall Street will likely be tested by a fresh batch of corporate results this week, including quarterly returns from artificial intelligence darling Nvidia (see below). Durable goods and consumer sentiment data will also be in focus as markets hunt for more evidence that growth is moderating enough to give the Fed justification for rolling out rate cuts this year.

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MFitch Ratings has downgraded China’s credit rating outlook to “Negative” from “Stable” due to concerns over growing public debt and slowing growth in the world’s second-largest economy. The agency affirmed China’s rating at A+, citing increasing risks to China’s public finance outlook. Concerns over slowing economic growth have grown in recent months, with Fitch expecting gross domestic product growth to fall to 4.5% in 2024.

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U.S. inflation data for February is expected to provide insights into the future direction of Federal Reserve monetary policy. The overall consumer price index (CPI) is expected to match the previous month’s pace of 3.1% annually, with the core CPI expected to slow to 3.7% from 3.9% in January. However, the month-on-month gauge is expected to shed light on price gains momentum.

Fed officials have made cooling inflation the main objective of interest rate hikes, which have brought borrowing costs to over two-decade highs. They suggest cuts may be coming later this year, but need more evidence that price growth is sustainablely easing back down to their 2% annualized target. Analysts at ING believe inflation is likely too hot for comfort.

U.S. inflation data for February is expected to provide insights into the future direction of Federal Reserve monetary policy. The overall consumer price index (CPI) is expected to match the previous month’s pace of 3.1% annually, with the core CPI expected to slow to 3.7% from 3.9% in January. However, the month-on-month gauge is expected to shed light on price gains momentum.

Fed officials have made cooling inflation the main objective of interest rate hikes, which have brought borrowing costs to over two-decade highs. They suggest cuts may be coming later this year, but need more evidence that price growth is sustainablely easing back down to their 2% annualized target. Analysts at ING believe inflation is likely too hot for comfort.