Stock Market - The Week Ahead

Joe Biden

There was growing doubt among his own party about President Joe Biden's chances of winning reelection in 2024. After his recent interview with ABC News, which was supposed to resolve these issues, the worries persisted.

Two more politicians, Reps. Mike Quigley of Illinois and Angie Craig of Minnesota, openly pushed Biden to reevaluate his plans to run for president, adding to the anxiety among Democrats.

Considering that Quigley and Craig are members of Biden's party, their demands for Biden to resign are noteworthy. Their words add to a broader sense of skepticism among Democratic strategists, funders, and politicians that has been gradually emerging.

The growing dissident voices inside the Democratic Party point to the need to look for candidates or other plans that would improve their chances in the upcoming election.

Inflation Data

This Thursday, July 11, is when the June inflation report is scheduled to be released. The Street anticipates a 3.1% YoY change and a 0.1% MoM change. It is anticipated that the core CPI will rise by 0.2%.

In terms of headline and core statistics, Bank of America is in line with the Street; nonetheless, it projects a YoY change of 3.2%.

Economists from Bank of America stated, "We would maintain our expectation for the Fed to start its cutting cycle in December should the CPI report print in line with our expectations."

Earnings Season

Preliminary results from the Q2 earnings season are starting to surface, and the S&P 500 is looking strong. According to projections, earnings increased by 8.6% in the second quarter of 2024 compared to the same time the year before, while revenues increased by 4.7%. Since the 9.9% increase seen in the first quarter of 2022, this predicted growth rate is the most noteworthy.

This earnings cycle's favorable revisions trend has created the conditions for what seems to be a period of sustained business resilience and increasing financial outlook. The S&P 500's predicted earnings growth indicates not just a strong comeback but also a possible change in the market's momentum

As usual, Friday marks the formal start of Q2 earnings season with reports from JPMorgan, Wells Fargo, and Citigroup.

Powell Speech and other data

Jerome Powell will speak before the Senate and House on Tuesday and Wednesday, respectively. Although monetary policy is the primary topic of discussion at the hearings, TD Cowen analysts also stated that they anticipate seeing some inquiries about other regulatory matters.

Investors will pay close attention to the U.S. Producer Price Index (PPI) report and weekly unemployment claims in addition to the highly anticipated CPI report. These two have respective due dates of Thursday and Friday.

(Sources: investing.com, reuters.com)