What will drive the markets this week?
On Friday, U.S. stocks surged, with the S&P 500 reaching a new record closing high, fueled by robust earnings and an impressive January employment report. This positive economic outlook, however, tempered expectations of imminent interest rate cuts by the Federal Reserve.
In Europe, markets initially showed gains but ultimately ended flat as they reacted to a surprisingly strong U.S. jobs report — the pan-European Stoxx 600, which had climbed over 0.7% earlier, closed without significant changes.
South Korea’s Kospi led gains in Asia-Pacific markets after Wall Street’s rebound, while China’s CSI 300 hit a new five-year low.
This week investors will gain valuable insights from over a half-dozen Federal Reserve officials, as they give insight into the Fed’s thinking and what recent economic reports mean for future action from the central bank.. Additionally, Treasury Secretary Janet Yellen is scheduled to testify to Congress on U.S. financial stability.
Earnings reports will continue to unfold, featuring updates from various sectors such as consumer, healthcare, and energy companies. Unilever PLC, McDonald’s, and PepsiCo are expected to showcase U.S. consumer strength, while Ford and Honda Motor Co. earnings will shed light on the state of the auto industry. Pharmaceutical firms including Eli Lilly & Co., Amgen Inc., and AstraZeneca PLC are set to report, along with energy giants ConocoPhillips Co. and BP PLC.
The week kicks off with the Senior Loan Officer Opinion Survey on Monday, offering insights into bank lending conditions. Investors can anticipate updates on the U.S. trade deficit, consumer credit, and wholesale inventories. Closing the week on Friday is the annual update of seasonal factors for the Consumer Price Index (CPI), potentially leading to adjustments in previously released CPI numbers.
Events expected to move the markets this week
Monday, Feb. 5
- McDonald’s (MCD), Caterpillar Inc. (CAT), Palantir Technologies Inc. (PLTR), ON Semiconductor Corp., (ON) and Tyson Foods Inc. (TSN) report earnings
- Atlanta Fed President Raphael Bostic speaks
- S&P final U.S. services PMI (January)
- ISM services PMI (January)
- Senior Loan Officer Survey
Tuesday, Feb. 6
- Eli Lilly (LLY), Amgen (AMGN), BP (BP), Gilead Sciences Inc. (GILD), Ford (F), GE HeathCare Technologies Inc. (GEHC), and Snap Inc. (SNAP) report earnings
- Minneapolis Fed President Neel Kashkari, Cleveland Fed President Loretta Mester and Philadelphia Fed President Patrick Harker deliver remarks
Wednesday, Feb. 7
- Alibaba Group Holding Ltd. (BABA), Disney (DIS), Uber Technologies Inc. (UBER), CVS Health Corp. (CVS), Arm Holdings PLC (ARM), and PayPal Holdings Inc. (PYPL) report earnings
- Fed Gov. Adriana Kugler, Fed Gov. Michelle Bowman and Richmond Fed President Tom Barkin deliver remarks
- US trade deficit (December)
- Consumer credit (January)
- Congressional Budget Office (CBO) budget and economic outlook
Thursday, Feb. 8
- S&P Global Inc. (SPGI), Philip Morris International Inc. (PM), ConocoPhillips (COP), Unilever (UL), Honda (HMC), and AstraZeneca (AZN) report earnings
- Initial jobless claims (Week ending Feb. 3)
- Wholesale inventories (December)
- Richmond Fed President Tom Barkin delivers remarks
- Treasury Secretary Janet Yellen’s congressional testimony
Friday, Feb. 9
- PepsiCo (PEP) reports earrings
- CPI annual seasonal adjustments.