Market Insights: What Drives the Stock Market?
As the economy and corporate earnings take center stage, investors are left wondering what truly moves the needle for the stock market. Typically, the monthly jobs report would be the main event, but with the recent cool inflation data and no October Fed meeting, earnings may take the spotlight.
Economists predict a modest 144,000 jobs added in September, with the unemployment rate holding steady at 4.2%. However, with more inflation and jobs data on the horizon, the Fed can afford to take its time before making any decisions. Clark Bellin of Bellwether Wealth notes that the recent core PCE print suggests interest rates may not need to be as high as they are, and investors should consider redeploying their cash into the markets as rates decrease.
Nike is set to report earnings, with expectations of an 8.5% revenue drop to $11.65 billion. Investors will be watching closely for signs of weakness in North America and the company’s guidance update, which may impact shares. Other notable earnings releases include Carnival, Paychex, and Constellation Brands.
In other news, OpenAI, the company behind ChatGPT, expects to lose $5 billion this year despite generating $3.7 billion in sales. The firm plans to increase prices aggressively, aiming for $100 billion in revenue by 2029. Meanwhile, Goldman Sachs has rebalanced its basket of 50 stocks with the highest consensus expected return on equity, featuring companies like Netflix, Tesla, and Humana.
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