Another Week of Inflation Data Arrives
Schwab Market Update Audio
Deep Dive
What key data release is expected this week?
The key data release is Wednesday's Consumer Price Index (CPI).
Which sectors have been leading the recent market gains?
Consumer discretionary, communications services, and infotech sectors have been leading the recent market gains, largely due to the presence of mega-cap companies.
What are the expected growth rates for the CPI and core CPI in November?
Analysts expect the CPI to show 0.2% headline growth and 0.3% core growth, with annual CPI climbing to 2.7% and core CPI expected at 3.3%.
What is the current market expectation for a Federal Reserve rate cut in December?
Traders currently see an 85% chance of a 25 basis point rate cut and a 15% chance of no move at the December Federal Open Market Committee meeting.
What was the performance of major U.S. indexes last week?
The S&P 500 rose 0.96%, the Dow Jones Industrial Average fell 0.60%, and the Nasdaq Composite gained 3.34%.
Why might the European Central Bank delay a 50 basis point cut?
The ECB might delay a 50 basis point cut due to concerns that inflation in the eurozone could overshoot to the downside, despite the recent tick higher in the consumer price index.
What is the significance of Oracle's earnings report?
Oracle's earnings are often seen as a general barometer of the tech market, making its report significant for understanding the sector's performance.
What was the key takeaway from the November nonfarm payrolls report?
The report showed jobs growth rebounding to 227,000, up from 36,000 in October, with unemployment climbing slightly to 4.2% and wages growing 0.4% month over month.
What is the current yield of the benchmark 10-year Treasury note?
The benchmark 10-year Treasury note yield closed last week at 4.15%, near 6-week lows.
What are the main factors influencing the Fed's decision on rates?
The main factors include the November jobs report, the CPI, and the PPI, all of which provide insights into labor growth and inflation.
- Investors await crucial U.S. inflation data, overseas central bank meetings, and tech earnings.
- Major U.S. indexes set new highs last week.
- November jobs report showed jobs growth rebounding to 267,000.
- Hopes for a Federal Reserve rate cut spiked on the jobs report.
- Wage gains were above analysts' estimates, suggesting the Fed has more work to do to clamp down on inflation.
- The Fed meets after central bank decisions from the Bank of Canada and the ECB.
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