With Wall Street back next week, trading may focus on higher prices
With investors returning from the long Labor Day weekend, they will likely find that the focus will be squarely on central bankers next week. That could mean more volatility for both stocks and bonds. There is a dearth of earnings news and economic reports. Instead, investors are likely to closely follow the actions of global central banks and the speeches of Federal Reserve officials, including Federal Reserve Chairman Jerome Powell, speaking at the Cato Institute conference on Thursday. Fed Vice Chair Lyle Brainard is also among more than six speakers at the Fed in the coming week. On the economic calendar, there is the ISM services data for August on Tuesday and July for international trade and the Fed’s Beige Book on Wednesday. “Tuesday is the Reserve Bank of Australia, and they will likely collect 50. Canada on Wednesday is likely to rise 75, and the European Central Bank on Thursday may do 75 as well,” said Mark Chandler, chief market strategist at Bannockburn Global Forex. Referring to an increase in interest rates by half and three quarters of a point. Chandler said the dollar, which has seen a strong move, could consolidate as other global central banks raise interest rates. The dollar index is up more than 0.7% for the week and up 7% over the past three months. “Maybe we’re short-term [dollar] Of the dollar, he said the correction “could be accompanied by higher stock prices and lower Treasuries yields. “I think everyone overestimated them a bit,” Chandler said of the massive sell-off in stocks and higher bond yields. Intraday highs of about 3.28%, the August employment report showed on Friday that the economy added 315,000 jobs close to what was expected, but the report also got some positive surprises, for example, there was a sudden jump in the participation rate to 62.4%, by 0.3 percentage points. This means that more people came out of the margins to join to the labor force. Wage gains were also lower than expected. Some economists took the fact that the labor force in August exceeded its pre-epidemic peaks as another good sign.” “The needle is moving a little bit more in favor of a soft landing, so that’s good for American businesses as well,” Chandler said. Traders also saw the jobs report opening the door to a possible half-point rate hike from the Fed. I am eting on September 20-21. However, the futures market was still priced at a fairly high 65% odds of a 75 basis point Fed rate hike. This would be the third in a row after similar increases in June and July. The next big economic report before the Fed meeting is the August CPI on September 13th. “I think we’ll have to look at the CPI report. That doesn’t remove 75 from the table, but it leans toward it more. About 50,” said Jim Poulsen, chief investment analyst at Leuthold Group. last week, and failed to sustain an early bounce after Friday’s jobs report.The S&P 500 closed at 3,924, down 3.3% for the week.Earlier in the week, the index fell by the 50-day moving average, which is literally Average last 50 closing price A break below that level is a negative sign of momentum Keith Lerner, co-CEO and chief market strategist at Truist Advisory Services, said some of the recent lower moves could be tested on Tuesday when more investors return to market, with summer unofficially drawing to a close. It’s the other side of Labor Day,” he said. Market volumes were relatively weak. It’s going to put more Wall Street back in its seats to absorb what happened.” Markets are expected to focus on other Fed and central bank comments next week. “In the short term at least, we think things have moved excessively unilaterally since the downturn,” Lerner said. Jun.” “Break below [the 50-day] It was a good thing. It brought more fear and a bit of a breakdown. “He said he expects some gains next week.” We’re down about 8% in 12 days,” he said, referring to the S&P 500. “We think the upper part of the range has solidified pretty well after the sell-off,” said Scott Riddler, technically, partner with T3Live.com, the latest range top will be the top at 4,325 from Aug. 16. The S&P 500 failed to sustain resistance at 4,018, and that could be a problem for the index in the coming sessions. He said that if the S&P does not hold at 3,903, traders will look for a test of the dips.Analyst Todd Sohn said he is watching a tech-heavy major index for clues about the market’s next move.The Invesco QQQ Trust, which represents the Nasdaq 100, is testing a short-term support level between $293 and 295, he said. The 61.8% retracement level was from the June low to the August high. QQQ closed Friday at $295.17. “If the market is and with the ability to maintain that level, I think we will test and break the June lows,” Sohn said. It is possible that the S&P 500 will also test its low at 3,637 if QQQ crashes and the S&P does not respond. 3900 mil. Oil drilling Oil prices have fallen sharply in the past week, with West Texas Intermediate crude futures down about 10% to just above $83 as of Friday afternoon. OPEC+ meets on Monday, and is expected to discuss production cuts to support prices. “We think they are likely to keep the official production policy in place for the time being,” notes Helima Croft, head of global commodity strategy at RBC. “Given the recent price swings, we certainly cannot rule out that the group is trying to put a stop to it, especially if there is another major downward move.” Next week’s calendar Monday Labor Day markets closed Tuesday Earnings: Gitlab, Coupa Software 9:45 a.m. PMI Services for August 10:00 a.m. ISM Services Wednesday Earnings: John Wiley, NIO, Dave and Buster’s, GameStop, Verint Systems, Asana, Caseys General Stores, AeroVironment 8:30 a.m. July International Trade 9:00 a.m. Fed President Richmond Barkin 10:00 a.m. Cleveland Fed President Loretta Mester 12:35 p.m. Fed Vice President Lyle Brainard 2:00 PM Beige Book 2:00 p.m. Fed Supervising Vice Chairman Michael S. Barr Earnings Thursday: US Offshore Brands, DocuSign, Smith & Wesson, Zscaler, Zumiez 8:30 a.m. Weekly Initial Jobless Claims 9:10 a.m. Fed Chair Jerome Powell at the Cato Institute Monetary Conference 3:00 p.m. July Consumer Credit Friday Earnings: Kroger 10:00 a.m. Wholesale Trade in July 10:00 a.m. Chicago Fed President Charles Evans 12:00 Noon Fed Governor Christopher Waller 12:00 Noon Kansas City Bank President Esther George
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