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Analytics, 13 May 2024

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) 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

Tuesday, May 14

Wednesday, May 15

Thursday, May 16

Friday, May 17

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