In recent weeks, the financial markets have experienced a significant uptick. Notably, the S&P 500 has surged by 8.2%, while the Dow Jones Industrial Average has seen an increase of 6.3%. The NASDAQ has particularly excelled, soaring by 10.8% since the beginning of June. This impressive rally raises an important question: will this momentum carry through into August, a month typically recognized as one of the weakest for market performance?
Despite August's historic challenges, I maintain a sense of optimism, largely due to the current strong earnings season. As reported by FactSet, approximately 34% of S&P 500 companies have released their earnings reports thus far, with an impressive 80% of these firms demonstrating positive surprises in both earnings per share and revenue. Among the notable companies reporting last week were the famed Magnificent Seven stocks, including Tesla, Inc. (TSLA) and Alphabet Inc. (GOOG).
This week, we anticipate earnings reports from four additional members of the Magnificent Seven. Specifically, Meta Platforms, Inc. (META) and Microsoft Corporation (MSFT) are set to announce their results on Wednesday, followed by Apple Inc. (AAPL) and Amazon.com Inc. (AMZN) on Thursday. The final report from this group will come from NVIDIA Corporation (NVDA) at the end of August, marking the conclusion of the earnings season.
In addition to earnings reports, there are several key economic indicators to monitor this week. The Federal Open Market Committee (FOMC) is scheduled to meet on Tuesday and Wednesday. While it is not expected that the Federal Reserve will announce any rate cuts during this meeting, I anticipate a dovish statement that may hint at a potential cut in September.
Furthermore, the Personal Consumption Expenditures (PCE) report is due for release on Thursday. Economists are forecasting a 0.3% increase in the PCE for June, a rise from the 0.1% reported in May, which translates to a 2.5% year-over-year increase. The core PCE, which excludes food and energy prices, is also expected to rise by 0.3% in June, up from 0.2% in May. Year-over-year, core PCE is projected to remain steady at 2.7%, unchanged from May.
For a comprehensive analysis of the Federal Reserve's decisions and the implications of the PCE data, be sure to look out for my upcoming Market 360 update later this week. In addition, I discussed what we can expect from the Fed, PCE, job data, and more in this week's Market Buzz. Click the image below to watch the episode now. If you want to stay informed with more insights from Market Buzz, consider subscribing to my YouTube channel.
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As we navigate through the current financial landscape, staying informed about market trends, key earnings reports, and economic indicators is crucial. With the right strategies in place, investors can leverage this information for potential success in the markets.
—Louis Navellier, Editor, Market 360
The Editor hereby discloses that as of the date of this email, the Editor, directly or indirectly, owns the following securities that are the subject of the commentary, analysis, opinions, advice, or recommendations in, or which are otherwise mentioned in, the essay set forth below:
