This week marks a significant period for the U.S. economy with Q2 earnings season, the Federal Open Market Committee (FOMC) meeting, and the Personal Consumption Expenditures (PCE) report. Key earnings reports from major companies such as Microsoft (MSFT), Meta Platforms (META), Apple (AAPL), and Amazon (AMZN) are anticipated. By August 1st, 164 companies in the S&P 500 will have reported their earnings.
The Federal Reserve is unlikely to lower interest rates during the FOMC meeting on Wednesday, with the current rate set at +4.25-4.50% since December. The unemployment rate stands at 4.1% and inflation at 2.7%. Despite low chances of an immediate rate cut (2%), there is a 67% probability for a 25 basis-point cut by September.
In labor market news, Initial Jobless Claims decreased to 217K last week, but ADP reported a decrease of -33K jobs in June. The BLS report showed +147K jobs added in June, with only about 70K positions outside government hiring, indicating potential weakness in the labor market.
