Beat the street: Powell; Fed; CPI; Macy’s; Occidental
Investors eye the US Federal Reserve, the Bank of England, and the European Central Bank for clues on whether the fight against inflation has been won.
Tuesday’s US inflation print could induce volatility for the dollar and indices. Occidental buys CrownRock. Plus, is Macy’s set to go private?
(AI Video Summary)
Key points for today
This week, the focus is on the Federal Reserve (Fed) and their stance on inflation, which can greatly affect the market. It's also important to watch for interest rate decisions from the Bank of England and the European Central Bank. One interesting piece of news is that an investor group has made a massive offer to take Macy's private.
Awaiting CPI figures
After reaching its highest levels since early 2022, the stock market is expected to have a slightly lower open. We're also waiting for the release of the Consumer Price Index (CPI) figures for November. Investors will be looking for any signs of a "Goldilocks scenario" for the US economy, meaning not too hot and not too cold.
The Federal Reserve is expected to cut rates by about 100 basis points, which is less than what the market is currently pricing in. This could lead to some short-term ups and downs in the market. The European Central Bank is also projected to make a move before the Fed, as European economic data is recovering faster. However, the Bank of England is unlikely to discuss rate cuts because inflation is still high.
Noteworthy current market activity
In terms of technical analysis, the S&P 500 is showing signs of "bullish fatigue," suggesting that the market may experience a short-term correction due to upcoming events and expectations of rate hikes. In the corporate world, companies like Adobe and Costco are expecting higher revenues and earnings. Meanwhile, Macy's has received a potential buyout offer to go private, and Occidental Petroleum is acquiring CrownRock in a $12 billion deal.
Oil prices are currently on a downward trend due to concerns about excess supply. Overall, the market is anticipated to have a lower or flat open as we await the outcome of these significant events happening this week.
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