As the sun set on the 17th of September, 2023, the stage was set for a financial spectacle.
Act I: The Federal Reserve Takes the Spotlight
Come Tuesday and Wednesday, we’ll see Jerome Powell and the Federal Reserve in the limelight. Rumor has it there won’t be any change in the benchmark interest rate, still floating between 5.25%-5.5%. Everyone’s holding their breath for the press conference drama post the policy release at 2:30 p.m. ET. Will it be a snooze or filled with surprise twists?
Act II: FedEx and the Enigma of Earnings
Meanwhile, on the corporate boulevard, FedEx is preparing for its quarterly performance, set to unravel on Wednesday. No spoilers, but the numbers should be… interesting.
Act III: Cars and Strikes – An Ongoing Drama
Don’t even get us started on the latest saga of the United Auto Workers (UAW). After a dramatic exit stage left from their contracts with Stellantis, GM, and Ford, a strike began, leaving the audience (a.k.a. the economy) in suspense. 13,000 UAW members have taken to the picket lines, leaving markets wondering if the Federal Reserve might use this as another reason to keep the interest rates stable. Who knew autoworkers had such a flair for the dramatic?
Markets have been on a rollercoaster, especially with Nasdaq sliding 2.3% so far in September. The Dow Jones hasn’t fallen far behind with a 0.3% drop. Yet, the general market mood seems to be more “meh” than “mayday,” as per the CBOE Volatility Index.
When Powell paused on the interest rate hikes this past July, he hinted at a strategy driven by data. Since then, we’ve seen inflation take a deep breath and the labor market chill a bit. But as to what will unfold at the central bank’s meeting, the magic 8-ball says, “Reply hazy, try again.”
Bank of America’s Michael Gapen hinted that this Wednesday is less about the actual rate and more about the “SEP show”. As the last plot twist in June indicated a rate hike in 2023, all eyes are on if this projection will take a turn.
In Other News…
Oil prices are seeing some action, especially with West Texas Intermediate and Brent crude futures nudging past $90 a barrel. And airlines, in their mini-verse of the market, seem to be bracing for impact. Jeffrey Kleintop pointed out, “Airlines might be small, but they could spill the tea on other businesses.”
Peeking at the Week Ahead:
Monday: Expect housing market index data and the latest from Stitch Fix.
Tuesday: Housing starts and permits will be on display, along with insights from AutoZone.
Wednesday: Mortgage applications and rate decisions come under the scanner, with FedEx, General Mills, and KB Home in the earnings spotlight.
Thursday: Initial jobless claims, home sales data, and earnings from FactSet and Scholastic.
Friday: A look at US manufacturing, services, and composite PMI.
And as the curtains draw on this week, we can’t help but wonder… will the financial world give us comedy, drama, or a cliffhanger? Stay tuned!
Disclaimer: This article is intended for informational purposes only. It should not be considered financial or investment advice. We do not hold any form of equity in the securities, cryptocurrency or commodities mentioned in this article as of 09/17/2023. Always consult with a certified financial professional before making any financial decisions.
