Market Watch: Wall Street is expected to see minor gains as investors await Federal Reserve meeting minutes and nonfarm payroll revisions, gold hits record highs, and Walmart sells stake in JD.com.
Fed minutesÂ
Investors await the release of minutes from the last Federal Reserve meeting to determine the likelihood of an imminent rate cut. The central bank held rates on hold in July, but comments suggest a September cut.
Federal Reserve Governor Michelle Bowman remains cautious on interest rate cuts, warning against overreacting to inflation data. Preliminary revisions to US labor data are expected to support further interest rate cuts.
Walmart is selling stake in JD
Walmart is selling its stake in Chinese e-commerce firm JD.com to raise $3.74 billion, allowing the company to focus on its China operations.
The move follows Walmart’s 17.7% year-on-year revenue rise from its China business to $4.6 billion in Q2, driven by strong growth in its Sam’s Club warehouse chain and digital offering.
However, concerns about employment and incomes have impacted consumer confidence in China’s retail market.
US retail earnings
The US earnings season is nearing its end, but retail sector figures are still crucial.
Target Corporation and TJX Companies are set to release quarterly results, and investors are assessing their market share in back-to-school sales.
Lowe’s cut its full-year forecast, and 93% of S&P 500 companies have reported earnings results.
Economic Calendar
- 07:00 AMÂ MBA Mortgage Applications
- 10:00 AMÂ Atlanta Fed’s Business Inflation Expectations
- 10:00 AMÂ Quarterly Services Survey
- 10:30 AMÂ EIA Petroleum Status Report
- 01:00 PMÂ 20-Year Bond Auction
- 02:00 PMÂ FOMC Minutes
- 02:00 PMÂ Treasury Buyback Results
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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.