By Bill Hornbarger, Chief Investment Officer
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Three Things to Watch
- With the end to a difficult second quarter coming Thursday, investors will brace for several important pieces of information. The economic data calendar includes the Fed’s favored inflation measure (personal consumption expenditures or PCE), the June ISM Purchasing Managers Index, consumer confidence, and durable goods orders. The ISM is expected at 54.7, indicating that manufacturing continues to expand, while PCE for May is expected to be mixed with overall PCE higher and core PCE lower, reflecting higher energy and food prices. Confidence has been declining with consumers impacted by higher inflation and volatile stocks. Fed Chairman Jerome Powell and four other Fed officials also have public speaking appearances.
- Earnings announcements from consumer related companies including Nike, General Mills and Bed Bath & Beyond will be released next week. Investors will also be on the lookout for early guidance on second-quarter earnings amid higher energy prices, supply chain issues, and high labor costs. Some companies might choose to pre-announce if they fear earnings will be disappointing.
- OPEC+ meets on Thursday and traders will look for confirmation of the output increases in July and August that were announced at the last meeting.
Three Things to Know
- July 1 to July 17 is the best two-week seasonal period of the year for stocks since 1928. (Source: zerohedge, Goldman Sachs)
- The Bloomberg Commodity Index has declined 11% since the recent peak on June 9. (Source: Bloomberg)
- Index provider FTSE Russell is due to rebalance its stock benchmarks at the close of trading, adding and deleting companies from indexes tied to trillions of dollars of investments. Among the stocks that will be moving from the Russell 1000 Growth Index to the Russell 1000 Value Index are Meta (parent of Facebook), Netflix, PayPal, and GameStop. (Source. The Wall Street Journal)
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.