It will be a busy and interesting week for the markets. Earnings season kicks off this week with the release of Pepsi’s earnings tomorrow morning. On the economic front we get a look at CPI data on Thursday and PPI on Friday. But, what might trump any of that will be Fed Chair Jerome Powell’s congressional testimonies on Wednesday and Thursday. After last week’s impressive jobs number market participants will be focused intently of what the Fed Chair has to say with regards to a possible/likely rate cut at the late July meeting. The market has been pricing a July rate cut into prices for a few weeks now. Any mention to the contrary could cause the markets particular consternation.
As for today, stocks spent the entire trading session in negative territory, with traders obviously concerned that the almost certain coming rate cut, might not be certain. By the close, the Dow Jones Industrial Average was down 115 points to finish the day at 26,806. The S&P 500 was down 14 points to close at 2,975. Gold was down $2 to trade at $1,397 per ounce, while oil was down $.09 to trade at $57.42 per barrel WTI.
It will be an interesting next few weeks as traders attempt to determine whether stock are properly priced. Are we entering, or have we entered, an earnings recession? Is the Fed committed to a rate cut at the next FOMC meeting, or did Friday’s jobs number put them on hold? Stay tuned for these answers and more. Have a nice evening everyone.