By Bill Hornbarger, Chief Investment Officer
Three Things to Watch
- Both investors and policymakers will anxiously await this week’s inflation data. Producer prices (PPI) and consumer prices (CPI) are scheduled to be released Tuesday and Wednesday, respectively. PPI is expected to be up 8.6% year-over-year and the consensus forecast for CPI is a 5.9% increase from a year earlier. Those would represent the strongest gains in 2021 for both measures.
- After last week’s announcement that the Federal Reserve will begin tapering bond purchases (the first step toward normalizing monetary policy), this week’s Fed speakers will be closely watched. Federal Reserve Chairman Jerome Powell, Boston Federal Reserve Bank President Kenneth Montgomery, Philadelphia Federal Reserve Bank President Patrick Harker and Chicago Federal Reserve Bank President Charles Evans are all scheduled to speak.
- Earnings season is winding down, but several high-profile companies will report this week including Disney, Wendy’s, AMC, and PayPal. According to Bloomberg, of the 447 S&P 500 members that have reported this quarter so far, 81% have posted an aggregate positive earnings surprise of 9.5%.
Three Things to Know
- Daylight saving time was first introduced in the United States during World War I, and it returned during World War II — then known as “war time.” It wasn’t formalized until 1966, with the passage of the Uniform Time Act. A financial cost for the biannual switch is hard to pin down, but a study by Chmura Economics & Analytics estimated that daylight saving time costs the U.S. more than $430 million a year. Other figures are even higher; a 2008 report by the Independent Institute claimed the annual costs for changing clocks twice a year could be as high as $1.7 billion. (source: Yahoo Finance)
- When President Biden signed a debt ceiling bill that added $480 billion to our existing debt ceiling on Oct. 14, the limit was raised to $28.9 trillion. Projections released by the White House at that time had Congress breaching the new limit on Dec. 3, 2021 or seven weeks later. As of Oct. 10, 2021, just eight days after the debt ceiling was raised, the nation’s outstanding debt hit the new ceiling of $28.9 trillion. (Source: MFS, Treasury Department)
- The MSCI emerging market index fell to an almost 20-year low versus the S&P 500. The ratio between the MSCI EM index and the S&P 500 declined to the lowest level since late 2001. The MSCI EM index is up 0.31% (through Nov. 4, 2021) versus the 26% gain for the S&P 500. (Source: Bloomberg)
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.