CPI is the Focus this Week

Good morning.

Stock futures are higher this morning as market participants looked ahead to the latest U.S. inflation data and more corporate earnings results.

Attention this week is already turning to Thursday’s critical U.S. CPI report for signs that disinflation has really set in after June’s report showed the smallest annual increases in consumer prices for two years.

The recent upbeat earnings performance of many S&P 500 companies follows waves of job cuts this year, prompted by worries the U.S. Federal Reserve’s aggressive interest rate hikes might throw the U.S. economy into a downturn. Major technology-related companies including Meta Platforms, Amazon and Alphabet have laid off tens of thousands of workers, solidifying their profit margins while their revenue continued to grow.

WTI crude futures fell below $82 per barrel. Gold fell below $1,940 an ounce while the yield on the US 10-year Treasury note retreated almost 10bps to below 4.1%.

With the falling markets last week, there are fewer stocks on the Horizon and < 200 Stocks list this week. As swing traders, we need these market reversals to provide us with future potential set-ups. Remember to be conscience of when the companies in your portfolio are going to announce earnings. In many cases, this provides a good opportunity to take some gains off the table prior to the earnings announcement. The decision is yours, based upon your risk tolerance.

Have a great day!

Mark