The U.S. stock market may attempt to move higher at the opening bell today, as traders prepare for another busy week on Wall Street. Over the next few days, investors will receive a number of important economic releases, as well as a handful of corporate profit reports. In addition, various Federal Reserve officials are slated to present speeches at events this week. As we were writing this update, the S&P 500 futures were up slightly in early-morning trading. The NASDAQ futures were also pointing higher, possibly aided by news that struggling chipmaker Intel (INTC) may be in M&A talks with Qualcomm (QCOM) and other interested parties, such as Apollo Global Management.
A number of key economic reports are scheduled for this week. Tomorrow, the Conference Board will publish the Consumer Confidence Index for the month of September. Investors will be looking to this report for confirmation that the consumer remains engaged and can continue to support the economy. On Thursday, the final estimate of second-quarter GDP (Gross Domestic Product) will be released. Here, investors will likely be seeking assurances that the economy is still in good shape and that a recession seems unlikely at this juncture. Finally, the main event this week is slated to take place on Friday, when the PCE (Personal Consumption Expenditures) Price Index is published. This report is expected to show that prices rose roughly 2.2% during the month of August, year over year, which would be quite close to the Federal Reserve’s 2.0% target. If for some reason, the numbers indicate that inflation remains problematic, stocks could become volatile, with traders speculating that the Fed might be reluctant to approve additional rate cuts.
This week we will receive profit reports from a handful of widely-held companies. Tomorrow, we will hear from KB Home (KBH), a leading homebuilder. On Wednesday, Micron Technology (MU), a major semiconductor manufacturer, will post its results, along with Jefferies Financial Group (JEF), a leader in the financial sector. On Thursday, we will receive word from Costco Wholesale (COST), one of the nation’s largest big box retailers. Positive guidance from these corporations would probably do much to improve investor sentiment.
Technically, the S&P 500 Index has found its way back to new high ground. However, the market has been choppy and erratic. Traders have had a good deal of news to digest, including the Fed’s much-anticipated decision to lower interest rates. Looking ahead, further volatility may be in store, as the third-quarter earnings season unfolds, and Americans vote for the next president. – Adam Rosner
At the time of this article’s writing, the author had a position in Intel.
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