Markets Eye Fresh Inflation Data Ahead of Holiday Weekend
As the shortened trading week approaches, investors are gearing up for a fresh reading on the Fed’s preferred inflation gauge, the Personal Consumption Expenditures (PCE) index. The Dow Jones Industrial Average (^DJI) has gained nearly 2% over the past week, while the S&P 500 (^GSPC) and the tech-heavy Nasdaq Composite (^IXIC) have added over 1.5%.
Economic Calendar Highlights
Updates on third-quarter economic growth and housing activity are also on the schedule, alongside quarterly results from major companies like Zoom (ZM), Dell (DELL), Best Buy (BBY), CrowdStrike (CRWD), and Macy’s (M). Markets will be closed on Thursday for Thanksgiving, and Friday’s trading session will end early at 1 p.m. ET.
Inflation Concerns Linger
Recent sticky inflation readings have raised questions about whether the Fed will cut interest rates in December and how much the central bank will lower rates over the next year. Federal Reserve governor Michelle Bowman has expressed concern that the Fed’s progress toward 2% inflation has “stalled” and suggested the central bank should proceed “cautiously” when cutting interest rates.
PCE Index Expectations
Economists expect annual “core” PCE — which excludes the volatile categories of food and energy — to have clocked in at 2.8% in October, up from the 2.7% seen in September. Over the prior month, economists project “core” PCE at 0.3%, unchanged from September.
Bitcoin Surges Amid Regulatory Shift
Meanwhile, Bitcoin (BTC-USD) has shot up nearly 50% since the presidential election, as crypto enthusiasts have cheered a changed regulatory outlook. SEC Chair Gary Gensler’s announcement that he will be stepping down on Jan. 20 sent bitcoin soaring to nearly $100,000 per coin for the first time ever.
Wall Street’s Bullish Outlook
Research firms are beginning to issue 2025 outlooks for the equity market, with largely bullish projections. While some experts caution that these targets may be overly optimistic, others believe the setup going into 2025 resembles exceptionally strong years rather than weak ones.
Economic Data Ahead
This week’s economic data releases include the Dallas Fed manufacturing activity, S&P CoreLogic 20-city year-over-year NSA, new home sales, and the Conference Board Consumer Confidence index. Investors will also be keeping a close eye on the FOMC Meeting Minutes from the November meeting.
Earnings Season Continues
A slew of major companies will be reporting earnings this week, including Bath & Body Works (BBWI), Zoom (ZM), Abercombie & Fitch (ANF), Autodesk (ADSK), Best Buy (BBY), and more.
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