The U.S. stock market may get off to a tentative start this morning, as traders prepare for a busy week ahead. Over the next few days, investors will receive an important decision from the Federal Reserve, numerous corporate profit releases, as well as the January jobs report. Meanwhile, military tensions in the Middle East should probably be monitored, as hostilities in the region could drive up the price of oil and threaten global supply chains. As we were writing this update, the S&P 500 Index futures were slightly ahead in pre-market trading.
In economic news, few notable reports will be published today. However, tomorrow the Conference Board will release the Consumer Confidence Index for the month of January. A relatively strong reading is anticipated. On Wednesday afternoon, the Federal Reserve’s Federal Open Market Committee (FOMC) will conclude its two-day policy meeting with an interest-rate announcement. Most investors think the Fed will leave interest rates unchanged at this juncture. Also at the close of the meeting, Chairman Jerome Powell will present some prepared remarks and field questions from the press. Here, investors will be looking for any information that might suggest when interest rate cuts could begin. Finally, on Friday morning the government will deliver the January Employment report. Analysts currently think the numbers will show that roughly 180,000 jobs were added to the economy during the month, down slightly from the December figure. The headline unemployment rate is expected to come in at the 3.8% mark. Hourly wages will also be examined for signs that inflationary pressures are easing.
In the corporate arena, numerous widely-held companies will post fourth-quarter earnings reports this week. Tomorrow, we will hear from Alphabet (GOOG) and Microsoft (MSFT). On Thursday, Apple (AAPL), Amazon.com (AMZN), and Meta Platforms (META) will weigh in with their numbers. Although many major corporations will deliver results this week, these leading technology issues have helped drive the market higher, and could have a notable impact on trading.
The stock market continues to forge ahead. The S&P 500 Index recently moved past the 4,800 level, and is now approaching the 4,900 mark. Cleary, the market environment has shifted. The economy does not seem to be headed for a recession in the near term, inflation is coming under control, and the Federal Reserve may soon relax its stance. Nonetheless, some investors may wonder if further market gains can be achieved without a period of consolidation. – Adam Rosner
At the time of this article’s writing, the author had positions in Alphabet and Amazon.com.
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