Reuters – Investors on Wall Street are keeping a close eye on the upcoming release of inflation data, with optimism that a slowdown in price increases could lead to an earlier end to the Federal Reserve’s monetary tightening policy. The data, expected to be published on Wednesday, is projected to reveal a cooling of consumer prices on an annual basis in June, which may impact the likelihood of further rate hikes following the July meeting.
Last week’s relatively strong jobs report has already boosted expectations of a 25 basis-point rate hike later this month, indicating confidence in the resilience of the U.S. economy. Central bank policymakers’ comments throughout the week will also be closely monitored by market participants.
Peter Andersen, founder of Andersen Capital Management, emphasized the significance of the Consumer Price Index (CPI) data to investors. He noted that they are hoping for cooler numbers, signaling to the Fed that rate hikes are effective, potentially leading to an earlier end to future rate increases.
In premarket trading, megacap growth stocks like Apple and Tesla showed signs of recovery after Monday’s losses. This followed Nasdaq Inc’s announcement of plans to rebalance its Nasdaq 100 index to address “overconcentration.” The impact of the rebalance is expected to be modest, according to Art Hogan, chief market strategist at B Riley Wealth, who stressed the greater attention given to S&P 500 component changes.
Amazon.com led the gains among megacap peers as it prepares for the “Prime Day” shopping event on July 11-12. The online retailer aims to attract U.S. shoppers with deeper discounts on various products and services, including its first-ever travel discounts.
As of 08:15 a.m. ET, Dow e-minis were up 44 points (0.13%), S&P 500 e-minis were up 8 points (0.18%), and Nasdaq 100 e-minis were up 36.75 points (0.24%). Most big banks also experienced gains, with JPMorgan Chase climbing 1.2% ahead of its quarterly results, and Wall Street banks expected to report higher profits for the second quarter.
However, the S&P 500 banks index has faced challenges this year, declining by 9%, largely due to the aftermath of the biggest crisis since 2008 that affected regional lenders. Zions Bancorp and Truist Financial saw slight declines after Jefferies downgraded their ratings to “hold.”
As Wall Street awaits the inflation data, the market’s response will shape investor sentiments and influence the future trajectory of the Federal Reserve’s monetary policies.
Credit: The Star : Business Feed
