Economy and Markets: The Week Ahead
Last week was nerve-wracking for investors, as they watched Apple (AAPL) stock tumble, dragging down market indexes. The tech giant slid on the news that China will ban iPhone use at government agencies and state-owned enterprises, apparently taking its “Technological Cold War” retaliation measures a notch higher.
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In addition, the markets were unnerved by an unexpected decline in initial jobless claims to their lowest level since February, leading to concerns that the declarations of a cooling in the labor market may have been unsubstantiated. The ISM Services Index also clocked in another strong increase, pointing at continued robust business activity in the sector responsible for almost 80% of the GDP. Besides, surging oil prices added to fears that the inflation may prove to be sticky, reinforcing the Federal Reserve’s hawkish stance.
All in all, last week’s economic reports painted an inflationary picture, which will affect the Fed’s interest rate decision going forward. While analysts expect the Fed to pause rate hikes at its coming meeting in September, the data supports its “higher-for-longer stance” and suggests that the inflation fight has not been won yet. That is why this coming week’s economic reports are of great importance to investors: they will add an indication of the health of the consumer sector to the data-dependent central bank’s data collection, strongly influencing its further moves.
In this uncertain environment, investors are recommended to base their decisions on trustworthy data and analysis.
Upcoming Earnings and Dividend Announcements
The Q2 2023 reporting season has almost ended, but there are still companies reporting this week.
The most market-moving earnings events this coming week are the reports of Oracle (ORCL) after Monday’s close and Adobe (ADBE) after Thursday’s close.
Other noteworthy reports this week are those of Casey’s General (CASY), Dollarama (DLMAF), and Lennar (LEN).
Companies’ reporting dates, consensus EPS forecasts, past data, analyst ratings, and price targets can be found on the TipRanks Earnings Calendar.
This week, Ex-Dividend dates are coming for the payouts of Harley-Davidson (HOG), Lam Research (LRCX), Hewlett Packard Enterprise (HPE), Taiwan Semiconductor (TSM), Merck & Company (MRK), Coca-Cola (KO), Chubb (CB), Altria Group (MO), Gilead Sciences (GILD), and other dividend-paying firms.
Companies’ Ex-Dividend and Dividend Payment dates, analyst ratings, and price targets can be found on the TipRanks Dividend Calendar.
Upcoming Economic Calendar Events
There are several extremely important reports scheduled to be published in the next few days:
» August’s Consumer Price Index (CPI) – Wednesday, 9/13 – This report, which measures the changes in the retail prices of goods and services over a specific period, is one of the two key inflation measures (the second one is the Personal Consumption Expenditures, or PCE). Policymakers, businesses, and consumers closely watch the CPI report, as it reflects the price trends in the economy. Higher-than-expected CPI numbers may not only suppress consumers’ spending plans but also impact the business outlook. Of course, the Federal Reserve incorporates the CPI into its calculations which affect the policy rate decisions.
» August’s Retail Sales – Thursday, 9/14 – This report, released by the U.S. Census Bureau, measures the monetary equivalent of purchases made by consumers over a specified period. It helps the economists and policymakers to assess the level of consumer demand, one of the main driving forces behind GDP growth. Thus, Retail Sales is a leading indicator, providing an outlook into the current quarter’s economic growth as well as into the inflationary factors on the side of demand.
» September’s Consumer Sentiment Index (preliminary)– Friday, 9/15 – This report, released by the University of Michigan, reflects the level of confidence the consumers feel towards the economy. This confidence affects consumer spending in the short term. Thus, the Index is used by economists, analysts, and policymakers as a leading indicator, helping to unveil the near-future trends in consumer demand, which directly affects economic growth.
Current and scheduled economic reports, Fed statements, and other releases, as well as their level of impact on stock markets, can be found on the TipRanks Economic Calendar.
