Wall Street progressed slightly before market this Wednesday, with the S&P 500 and the Dow Jones gaining another 0.1%, now very close to peaks…
(Boursier.com) — Wall Street progressed slightly before market this Wednesday, with the S&P 500 and the Dow Jones gaining another 0.1%, now very close to historic peaks, compared to an increase of 0.2% on the Nasdaq. The markets rather appreciated the inflation figures yesterday, which were quite close to expectations. They will follow the announcements from the Fed and Jerome Powell this evening.
The Fed’s monetary statement will be released this evening at 8 p.m., while Jerome Powell’s conference will be held at 8:30 p.m. The American central bank will most likely leave its rates unchanged between 5.25 and 5.5% on fed funds (probability of more than 98% according to the FedWatch barometer). This would be the third consecutive status quo on rates for the Fed, which therefore seems to have finished with monetary tightening, without wanting to “pivot” too quickly.
The markets anticipate a potential monetary easing on March 20 (approximately 50% probability) or May 1, 2024… Also this Wednesday, the producer price index in the United States, the index of expectations of inflation from the Atlanta Fed, as well as the weekly report on US domestic oil stocks.
Tomorrow Thursday, the day will be marked by announcements of weekly unemployment registrations, retail sales, import and export prices, as well as business stocks and sales.
Finally, on Friday, Four Witches Day (simultaneous expiration of 4 types of contracts: index and stock options, as well as index and stock futures), investors will follow the Empire State manufacturing index from the New York Fed, industrial production figures, as well as the US composite flash PMI index.
Janet Yellen, American Secretary of the Treasury and former head of the Fed, delivered economic comments yesterday, in the midst of a blackout preventing officials of the American central bank from speaking before the FOMC’s monetary decision. Yellen said she saw no reason why inflation should not return to the Fed’s 2% target. She notes that inflation is moderating significantly and believes that the economy is on track for a soft landing. She adds that the high level of long-term rates should put pressure on the fiscal outlook. According to the head of the US Treasury, the rise in real rates could impact the Fed’s decisions on the pace of rates.
In any case, inflation expectations would be “largely under control”, according to Yellen, who rules out a entrenchment of inflation or an inflationary wage spiral. She also specifies that the job market remains strong but is easing, and judges that it is not necessary to have high unemployment to bring down inflation…
The American consumer price index for the month of November 2023 showed an increase of 0.1% compared to the previous month, against a stable consensus and after a month of October without change. Year-on-year, the US CPI for November increased by 3.1% as expected. Excluding food and energy, this price indicator increased by 0.3% compared to the previous month and by 4% over one year. Finally, the average hourly wage appreciated a little more than expected, up 0.4% compared to the previous month and 4% over one year.
In Wall Street business news, Adobe And Nordson Corporation reveal their results this evening. Costco Wholesale (after stock exchange), Lennar, Jabil And Manchester United announced Thursday. Darden Restaurants will finally be on the Friday menu.