With Labor Day marking the end of summer, traders and portfolio managers are returning to their desks, bringing with them a week of heightened market activity and seasonal portfolio adjustments. As midterm elections approach, adding potential volatility, several key events are set to shape investor sentiment this holiday-shortened week.
The primary focus remains on inflation metrics. The producer price index (PPI) and consumer price index (CPI) for August will be released on Thursday and Friday, respectively. These reports arrive just ahead of the Federal Open Market Committee’s policy meeting on September 15-16, where market indicators currently suggest a 60% probability of an interest rate hike. Fed Governor Christopher Waller recently indicated that his vote would depend heavily on the latest inflation readings, stating he supports maintaining current rates if progress toward the 2% inflation goal continues, but would consider a hike if data shows a resurgence.
Economists polled by FactSet anticipate the wholesale PPI to rise 0.4% month-over-month and 5.4% year-over-year, while core PPI is expected to increase 0.3% monthly and 4.6% annually. Friday’s CPI is projected to show a 0.36% monthly gain and a 3.3% annual increase, with core CPI expected to climb 0.2% month-over-month and 2.3% year-over-year. Any shifts in the geopolitical landscape, particularly regarding Iran, could also influence the Federal Reserve’s stance regardless of the backward-looking data.
In the technology sector, Apple’s upcoming iPhone launch event on Wednesday draws significant attention. The presentation will not only introduce the latest devices but also serve as the formal introduction to the new CEO of the world’s second-most valuable company. Meanwhile, earnings season continues to slow, with investor conferences offering additional insights from corporate executives.
For CNBC viewers, the September Monthly Meeting is scheduled for Thursday at noon ET, providing further analysis of these developments as markets navigate the final stretch of the summer trading period.
Good luck trading with half the market on vacation after Labor Day. Thin volume always makes these weeks unpredictable.
Does anyone actually trust these PPI forecasts? They’ve been wrong all year, and I doubt they’ll get it right now.
Is anyone else just here for the Apple keynote? The CEO reveal is the real headline this week for tech investors.
That 60% chance of a rate hike feels high to me. Hopefully the CPI data comes in softer than expected.