📊 Market Recap: S&P 500 Edges Higher, but Breakout Lacks Conviction
Last week, the S&P 500 pushed higher, closing the price gap from two Fridays ago. While the index technically reached new highs, the move lacked strength—leaving the potential for a reversal back below that level.
Meanwhile, the Equal-Weight S&P 500 remains below its prior highs, suggesting that broader market participation hasn't been strong.
🔥 Inflation in Focus: CPI Steady, but PPI Surprises
The spotlight last week was on inflation:
CPI (Consumer Price Index):
Monthly: Headline and core readings matched consensus expectations.
Year-over-year:
Headline: 2.7% (in line with last month, slightly below expectations)
Core: 3.1% (0.2% above the previous month and a tenth above consensus)
PPI (Producer Price Index):
Headline PPI surged to 3.3%, the hottest monthly reading since March 2022.
Core PPI rose to 3.7%, also well above forecasts.
This unexpected jump in wholesale inflation could point to higher CPI figures in the coming month.
🗣️ Fed Watch: September Rate Cut in Play?
Following a softer nonfarm payrolls report, Fed commentary has gained attention:
A September rate cut is now almost fully priced into markets.
Some Fed members have even mentioned the possibility of a 50 basis point cut, though we remain skeptical about that scenario.
📈 Earnings Roundup: Strong Numbers, Mixed Market Reactions
Earnings season is wrapping up:
Growth is tracking at 11.8%, far exceeding expectations.
81% of companies have beaten estimates.
Despite strong numbers, stock price reactions remain mixed—a sign that investors are weighing other macro factors.
Looking ahead, retail sales data may offer clues about future earnings strength. Early signs of consumer weakness could emerge. While the dip two weeks ago was brief, we believe there’s still potential for market softness in the coming month.
📅 The Week Ahead: Light Economic Calendar
This week will be relatively quiet on the economic front:
Housing Data – Continues to show weakness
FOMC Minutes – Released Wednesday
Jobless Claims – As usual, on Thursday
We’ll be watching for any surprises and signals about where the Fed goes next.
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– HPK Provident Advisors
Plan for today, Prepare for tomorrow
Disclaimer:
The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. All performance referenced is historical and is no guarantee of future results. All indices are unmanaged and may not be invested into directly. Economic forecasts may