What will drive the markets this week?
Friday saw modest gains in U.S. stocks, marking another weekly rise across all three indexes. Investors closely analyzed statements from Federal Reserve officials while anticipating pivotal inflation data next week. The Dow Jones Industrial Average climbed by 125.08 points (0.32%) to reach 39,512.84. Similarly, the S&P 500 edged up by 8.6 points (0.16%) to settle at 5,222.68, though the Nasdaq Composite experienced a minor dip of 5.40 points (0.03%) to 16,340.87.
In Europe, the primary stock index attained a record high, heading towards its most substantial weekly ascent since late January. The pan-European STOXX 600 closed 0.7% higher, with key economies like Germany and France marking record highs in their respective indexes.
In Asia-Pacific, Hong Kong led the market surge, mirroring the gains on Wall Street, driven by renewed optimism for U.S. Federal Reserve rate cuts. The Hang Seng index hit its highest level in 10 months, climbing by 2.32%, buoyed by reports suggesting a potential tax exemption for individual investors on dividends earned from Hong Kong stocks bought via Stock Connect.
This week, concerns about rising inflation have gripped both Federal Reserve officials and investors, with the release of the Consumer Price Index (CPI) poised to shed light on whether the economy is still feeling the pinch of price pressures.
Federal Reserve Chair Jerome Powell is scheduled to address an international conference this week, alongside a series of remarks from various other Fed officials. The repeated message from Fed representatives has been the necessity of clear evidence that inflation is being managed before any adjustments to the central bank’s benchmark interest rate can be considered.
Market attention will be focused on several retailers this week, including Walmart (WMT), Home Depot (HD), as well as Chinese e-commerce giants JD.com (JD) and Alibaba Group (BABA) as they prepare to release their earnings reports. Additionally, Cisco Systems (CSCO) and Sony Group (SONY) are slated to report their financial results this week, adding to the market’s agenda.
Events expected to move the markets this week
Monday, May 13
- Federal Reserve Vice Chair Phillip Jefferson and Cleveland Fed President Loretta Mester deliver remarks
- Tencent Music Entertainment Group (TME) reports earnings
Tuesday, May 14
- NFIB small business optimism (April)
- Producer Price Index (April)
- Federal Reserve Chair Jerome Powell delivers remarks at an event in the Netherlands.
- Home Depot (HD), Alibaba Group (BABA) and Sony Group (SONY) report earnings
Wednesday, May 15
- Consumer Price Index (April)
- U.S. retail sales (April)
- Empire State manufacturing survey (May)
- Home builder confidence (May)
- Business inventories (March)
- Cisco Systems (CSCO) reports earnings
- Deadline for 13F filings, which will reveal the stock holdings as of the end of the first quarter for Warren Buffett, Dan Loeb and other major investors.
Thursday, May 16
- Initial jobless claims (Week ending May 11)
- Philadelphia Fed manufacturing survey (May)
- Housing starts (April)
- Building permits (April)
- Import price index (April)
- Industrial production (April)
- Capacity utilization (April)
- Philadelphia Fed President Patrick Harker, Atlanta Fed President Raphael Bostic, and Cleveland Fed President Loretta Mester deliver remarks
- Walmart (WMT), Applied Materials (AMAT), JD.com (JD), Baidu (BIDU), Take-Two Interactive Software (TTWO), and Deere & Company (DE) report earnings
Friday, May 17
- U.S. leading economic indicators (April)