A look back
- Stocks had a solid week with the S&P 500 gaining 1.2% and closing at a new all-time high on Tuesday. Emerging markets were flat while international developed markets lagged, dropping -0.5%.
- Yields took a breather with the 10-year U.S. Treasury yield ending at 5.24% and the 2-year at 4.78%. U.S. crude oil was roughly flat on the week below $92/barrel. This stabilization in rates and oil prices aided the S&P 500’s gain.
- The minutes from the September Federal Reserve (Fed) meeting were released, showing most policymakers expect at least one more rate hike this year. Futures markets are currently pricing in just an 18% probability of a hike at the October meeting.
A look ahead
- Inflation takes center stage with both the Consumer and Producer Price Indices (CPI and PPI) on the docket. Investors will also keep an eye on September Retail Sales data in a relatively busy week of economic data.
- Third quarter earnings season gets started in earnest with major banks in the spotlight this week. Consensus estimates are currently for the S&P 500 to post earnings growth of roughly 30%, led by the Energy and Technology sectors.
- Economic releases: Existing Home Sales, CPI, PPI, Retail Sales, Wholesale Inventories, Industrial Production, Capacity Utilization.
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