S&P 500: Wall Street Braces for Inflation Report Amid Market Anticipation
08 Sep 2023
In anticipation of the inflation report, Wall Street is expected to muted open.
In the fast-paced world of finance, every bit of information counts. Investors, both seasoned and new, eagerly await crucial economic indicators that can sway the markets. One such event that often keeps Wall Street on its toes is the release of the inflation report. In this article, we’ll delve into the anticipation surrounding the upcoming inflation report, its potential impact on Wall Street, and the broader implications for the economy.
The major Wall Street indexes were set for a muted opening on Friday as investors awaited a new inflation reading the following week. Recent economic data have raised concerns that interest rates would rise for an extended period.
On September 13, the Consumer Price Index (CPI) reading for August is due, and on September 20, the Federal Reserve will announce its monetary policy. The significance of these two events cannot be overstated, as they hold the key to understanding the economic landscape in the United States.
Reading the Tea Leaves
“This month of September so far has taken the path of a negative outlook on rates, meaning that the Fed will probably continue to raise rates to combat the stubborn growth of the economy in the U.S.,” said Peter Andersen, the chairman and CEO of Andersen Capital Management. Andersen’s insight highlights the cautious sentiment among financial experts regarding the trajectory of interest rates.
After a two-day selloff in response to reports that Beijing had just ordered employees of the central government to cease using iPhones at work, shares of Apple (NASDAQ: AAPL) dipped 0.1% in premarket trade. It’s important to note that while this dip may seem unrelated to the inflation report, it underscores how sensitive the stock market can be to external factors.
The curbs are expected to have a minor impact on Apple’s revenue this year, according to Wall Street analysts. Morgan Stanley estimated that a 4% decline was the worst-case scenario. This example serves as a reminder that market reactions are not always predictable and can be influenced by various news developments.
Let’s take a closer look at the technical aspects of the S&P 500, a key indicator for the overall health of the stock market.
S&P 500 TECHNICAL ANALYSIS DAILY CHART:
- S&P 500 is currently trading in the up channel.
- S&P 500 is currently trading above 5&50 all SMA.
- RSI is in the buying zone which suggests bullishness, and Stochastic is suggesting a positive trend.
- Immediate resistance is at 4480.85 & its immediate support level is 4433.98.
HOW TO TRADE S&P 500 IN THIS WEEK
The S&P 500 fell after climbing upside. As of now, the S&P 500 has taken support and begun to rise again; it is currently trading at resistance; if this zone is broken, further upside is possible.
TRADE SUGGESTION- ENTRY AT 4496.48, TARGET AT 4547.62, SL AT 4465.23.
In conclusion, the anticipation of the inflation report and its potential impact on Wall Street has sent ripples through the financial world. With the Federal Reserve closely monitoring economic indicators, investors are bracing themselves for potential interest rate changes that could influence their investment strategies. Additionally, the sensitivity of the market to external factors, as seen in Apple’s stock dip, reminds us of the intricate web of global events that affect financial markets.
What is the inflation report, and why is it important for investors?
The inflation report provides crucial data on the changing prices of goods and services in an economy. It’s important for investors because it can influence central bank policies, including interest rates, which, in turn, affect investment decisions.
How does the Federal Reserve’s monetary policy announcement impact the market?
The Federal Reserve’s monetary policy announcement can impact the market by signaling changes in interest rates or other economic policies. Investors closely watch these announcements for insights into the central bank’s stance on the economy.
Why did Apple’s stock dip in response to reports about government employees ceasing to use iPhones?
Apple’s stock dip in response to such reports reflects market sensitivity to external factors. Investors may react to news that could potentially impact a company’s revenue, even if it’s not directly related to its core business.
What is technical analysis, and why is it important for traders?
Technical analysis involves studying past market data, primarily price and volume, to forecast future price movements. It’s important for traders as it provides insights into potential market trends and entry/exit points for trades.