November 18, 2024
Good morning,
The S&P 500 Index was off -2.08% last week. All those losses came after Fed Chair Powell’s comments Thursday afternoon: “The economy is not sending any signals that we need to be in a hurry to lower rates. The strength we are currently seeing in the economy gives us the ability to approach our decisions carefully.” Markets tend to react once to news events. Is -2% enough of a reaction to the Fed tapping its brakes on rate cuts? Given the strong tape in recent weeks, it probably is. However, if the Fed Chairs’ comments were more of a wake-up call for equities to pay attention to runaway yields (about to cross 4.50% on the 10 yr. U.S. Treasury), then more corrective days are ahead. I lean toward the former and give the tape the benefit of the doubt.
This week’s economic calendar lacks any key figures, starting slowly with a focus on housing data. The more potentially market-moving data are positioned at the back end, as we get Initial and Continuing Jobless Claims, along with S&P Global PMI Reports and U of Mich Consumer Confidence to close out the week (ho-hum).
There are a slew of Retail and Technology earnings from the likes of Walmart, Lowe’s, Target, TJX, PANW, SNOW, as well as the major earnings announcement of the week on Wednesday from Nvidia Corp – they generally send reverberations throughout the AI tech space.
Be well,
Mike
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