By Bill Hornbarger, Chief Investment Officer
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Three Things to Watch
- The U.S. Federal Reserve (Fed) will announce its June rate decision Wednesday afternoon, followed by Fed Chairman Jerome Powell’s press conference. Markets are priced for no move on rates, but the Fed will update the dot plot and its projections on the path of interest rates, inflation and economic growth.
- Before the bell on Wednesday (and before the Fed announcement), the May Consumer Price Index will be released. The consensus forecast is for a 0.3% month-over-month increase in the core inflation rate and a drop in the annual rate to +3.5% from +3.6%. After a hotter-than-expected May jobs report last Friday, the whisper numbers are for a slightly above-consensus reading.
- There are multiple high-profile investor events this week, including an artificial intelligence (AI) event for Apple, an Amazon event and the Tesla annual meeting where shareholders will vote on, among other things, Elon Musk’s compensation package worth more than $50 billion.
Three Things to Know
- The Bank of Canada cut rates last week for the first time in four years. Rates were reduced 25 basis points, and the target for the overnight rate was reduced to 4.75%, with the bank rate at 5% and the deposit rate at 4.75%. (Source: Seeking Alpha)
- In Cheyenne, Wyo., six individuals have filed to run for mayor, with one standout candidate: VIC, or Virtual Integrated Citizen. Developed by OpenAI, VIC uses AI for data-driven decision-making, transparency, efficiency and innovation in city administration. Although VIC is supported by a human team, the candidacy presents legal questions, as current law requires candidates to be human registered voters. (Source: oilcity.news)
- Over the past seven years, nearly all of the 7.5% annualized gains in the 60/40 U.S. stock/bond portfolio have come from the stock side, with the S&P 500 gaining 11.6% per year versus just 0.8% per year for bonds. (Source: @charliebilello)
The above information reflects the current opinion of the author. It is based upon sources and data believed to be accurate and reliable. Opinions and forward-looking statements expressed are subject to change without notice. This information does not constitute a solicitation or an offer to buy or sell any security mentioned.