Wall Street Weekly Kickoff: Key Insights and Analysis for the Trading Week Ahead

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•  Jul 09 2023
 

The stock market opened the second half of 2023 down about 1% last week, with the S&P 500 up 14.5% since the beginning of the year, the Nasdaq up 30.5% in the same period. Most of the gains are mainly attributed to Nvidia, which has risen so far this year in 190% and Apple, which added a trillion dollars to its value in the last six months.

The consumer price index in China is expected to show stability in June and an increase of only 0.2% on an annual basis. China is unable to start the economy after the reopening towards the beginning of the year, the citizens are not spending and the economy is on the verge of deflation. The producer price index will also be published and is expected to show a decrease of 5% in the last 12 months.

The most important and relevant inflation index for investors will be published this Wednesday and according to forecasts the inflation figure for June is expected to be 0.3% compared to 0.4% in May. In an annual view, the index is expected to increase by only 3.1% after the month before the figure stood at 4%.

The core index (which does not include food and energy) is much less encouraging and is expected to show an increase of 5% in the last 12 months, the figure for May was 5.3%. On a monthly basis, the core index is expected to increase by 0.3% and is probably a significant reason why investors expect the Fed to raise interest rates in the next meetings to a range of 5.25%-5.5% with a probability of 93%.

On Thursday, the producer price index will be published, which is expected to show a monthly increase of 0.2%, similar to the previous month. On the same day, the number of claims for unemployment benefits for the past week will also be published, with the expectation of 249,000 new claims, last month the figure was 248,000.

The Fed's next meeting on September 19/20 will take place The US job market set the tone this week. But it is not clear whether the resulting pricing is justified, against the background of a significant increase in the number of jobs according to the ADP data, and a somewhat complex picture of the Nonfarm data. In the meantime, the moderation of inflation expectations continues to lead to an increase in real yields, accounting for the current high interest rate expectations.

Please note that the article should not be considered as investment advice or marketing, and it does not take into account the personal data and requirements of any individual. It is not a substitute for the reader's own judgment, and it should not be considered as advice or recommendation for buying or selling any securities or financial products.

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