This Week: Inflation Data and the Fed

The focus this morning as we begin a holiday-shortened week on Wall Street will be on the inflation data due out later in the week, with the Personal Income and Outlays report which includes the core PCE measure. Traders will look to this week’s figures and comments from Federal Reserve officials to get a better gauge on when the Fed will cut rates. Between now and Friday, keep an eye on Consumer Confidence later this morning. Thursday, we have GDP, Jobless Claims, and Pending Home Sales. This week, we’ll also hear from a handful of Fed officials including Mester, Kashkari, Williams, and Bostic.

This week in terms of companies reporting quarterly results, we have a bunch of retailers with Costco (COST), Chewy (CHWY), and Dick’s Sporting Goods (DKS) topping the list of names to watch. In terms of tech, Salesforce (CRM), C3.ai (AI), HP (HPQ), and Dell Technologies (DELL) could move markets.

Lastly, keep an eye on the U.S. Dollar and the 10-year Treasury Yield, both of which have been very much rangebound and supportive of the move up we’ve seen in in the indices to new all-time highs. The lack of conviction and rangebound tendencies are a reflection of the Fed’s “wait and see mode,” so I look to these two markets to provide the first indication the scales have tipped one way or the other in rates. As of now, they seem balanced at stubbornly elevated levels, and the market likes balance.