What will drive the markets this week?
On Friday, U.S. stocks experienced a robust rally after dovish statements from Federal Reserve Chair Jerome Powell strengthened expectations for reducing the central bank’s key policy rate this September.
The Dow Jones Industrial Average advanced by 462.3 points, or 1.14%, closing at 41,175.08. The S&P 500 increased by 63.97 points, or 1.15%, to reach 5,634.61, while the Nasdaq Composite soared by 258.44 points, or 1.47%, ending at 17,877.79.
European markets also closed near session highs with widespread gains on Friday, as global investors reacted positively to Powell’s announcement that “the time has come” to reduce interest rates. The pan-European STOXX 600 index climbed 0.5% to close at 518.13, its highest level in over three weeks, marking the third consecutive week of advances.
In Asia, shares outside Japan dipped by 0.1%, while Japan’s Nikkei index gained 0.4% as investors processed inflation data and comments from Bank of Japan Governor Kazuo Ueda indicating readiness to raise interest rates if economic conditions and inflation align with forecasts.
This week, Nvidia (NVDA) is set to release its earnings report on Wednesday, kicking off a busy week for corporate financial updates. Other tech companies, including Salesforce (CRM), Dell (DELL), HP (HPQ), and CrowdStrike (CRWD), are also scheduled to report their earnings. In the retail sector, Dollar General (DG), Five Below (FIVE), Abercrombie & Fitch (ANF), and Ulta Beauty (ULTA) are among those expected to share their results.
On Friday, the Personal Consumption Expenditures (PCE) report will be closely watched to determine if inflation continued to ease in July, which could influence the Federal Reserve’s next steps. Additionally, the second-quarter Gross Domestic Product (GDP) figures will be released on Thursday, with investors also paying attention to housing market data and consumer sentiment surveys.
Events expected to move the markets this week
Monday, Aug. 26
- Durable goods orders (July)
- Dallas Fed Manufacturing Survey (August)
- Trip.com (TCOM) reports earnings
Tuesday, Aug. 27
- S&P CoreLogic Case-Shiller home price index (June)
- FHFA House Price Index (June)
- Richmond Fed Manufacturing Index (August)
- Consumer Confidence (July)
- Bank of Montreal (BMO), Bank of Nova Scotia (BNS), Box (BOX) and Ncino (NCNO) report earnings
Wednesday, Aug. 28
- Atlanta Fed President Raphael Bostic delivers remarks
- Nvidia (NVDA), Salesforce (CRM), Royal Bank of Canada (RY), CrowdStrike (CRWD), HP (HPQ), Okta (OKTA), Abercrombie & Fitch (ANF) and Five Below (FIVE) report earnings
Thursday, Aug. 29
- Initial jobless claims (Week ending August 24)
- Gross Domestic Product (Q2 - First revision)
- Pending home sales (July)
- Advance wholesale inventories (July)
- Advance international trade: Goods (July)
- Advance retail inventories (July)
- Atlanta Fed President Raphael Bostic delivers remarks
- Dell (DELL), Marvell Technology (MRVL), Autodesk (ADSK), Canadian Imperial Bank of Commerce (CM), Lululemon (LULU), Dollar General (DG), Ulta Beauty (ULTA) and Birkenstock (BIRK) report earnings
Friday, Aug. 30
- Personal Consumption Expenditures (July)
- Chicago Business Barometer (August)
- Consumer sentiment (August)