Fed Minutes, Retail Earnings, Data: Wall Street’s Key Week

Wall Street is poised for a significant week, with market movements expected to be shaped by the Federal Reserve’s latest policy meeting minutes, upcoming quarterly earnings from major US retailers, and a series of key economic reports.

The Federal Reserve’s policy meeting minutes, scheduled for release on Wednesday, are highly anticipated. These minutes are expected to offer critical insights into policymakers’ discussions concerning interest rates.

Interest Rate Expectations Shift

Expectations for an immediate interest rate hike in September have diminished considerably. This shift follows weaker-than-expected US employment figures and a slight moderation in inflation data.

Currently, US money markets indicate only a 27% chance of a 25-basis-point increase at the next Fed meeting. A full reflection of a rate increase in market pricing is not expected until early next year.

Retail Sector Provides Economic Insights

Investors will also closely monitor quarterly results from prominent retailers to gauge consumer spending and the overall health of the US economy. Companies such as Walmart, Target, Home Depot, Costco, Kroger, and Albertsons are slated to report their earnings.

Key Economic Reports Scheduled

A comprehensive series of economic reports are scheduled throughout the week, offering further data points on the US economic landscape. These include preliminary US purchasing managers’ data for August, along with manufacturing and housing figures.

On Monday, the Empire State Manufacturing Survey and the NAHB Housing Market Index will be released. Tuesday’s calendar features Housing Starts, Industrial Production, and the Pending Home Sales Index.

Wednesday will bring the Federal Open Market Committee meeting minutes. Thursday will see the Philadelphia Fed Business Outlook Survey and Weekly Jobless Claims, while Friday concludes with US Flash PMIs for Manufacturing and Services.

Government Bond Auctions Underway

The US government bond markets will also experience activity this week. Auctions are scheduled for $16 billion in 20-year bonds and $8 billion in 30-year Treasury Inflation-Protected Securities (TIPS).

Beyond the retail sector, other major companies like BHP Group, Baidu, Lowe’s, and Alibaba are also scheduled to report their quarterly earnings.

Last week, US stocks retreated from all-time highs on Friday, influenced by weak retail sales data and an increase in crude oil prices. The S&P 500, Dow Jones Industrial Average, and Nasdaq Composite all experienced declines on that day, though the S&P 500 and Nasdaq ended the week slightly up, with the Dow finishing down.