Wall Street starts the week with bullishness, with investors looking at Wednesday’s July US inflation figure. In New York, the Dow Jones and the S&P 500 advanced 0.62% and 0.68%, respectively, while the Nasdaq rose approximately 0.9%.
Investors are focused on Wednesday’s reading of the consumer price index in July and try to gauge how aggressive the Fed may be in raising rates in an effort to curb the spike in the cost of living. According to analysts’ expectations, the general figure should show a slowdown to 8.7% from 9.1% mainly due to the drop in gasoline seen in the last month, but the core one is instead expected to accelerate to 6.1% from 5 , 9%. “It will be important to verify whether the shelter component in particular will begin to show signs of a slowdown”, the strategists of Mps Capital Services point out.
Algebris, presenting the reflections of his global credit strategy team, points out that after the data on the labor market released last Friday “the market now prizes a good chance of a 75 basis point hike in September and a terminal rate of 3.6. % to be reached in March 2023, about 35 bps above the lows reached after the Fed meeting ”and indicates US inflation in July as the next key figure for the markets. “A weakening of commodities indicates that headline inflation will be moderate and may even remain unchanged month over month – experts say -. Core pressures, on the other hand, should remain relatively high and the center of attention. After the jobs results, any data that fails to convince the markets that the inflation peak is now in sight will trigger a further adjustment in US and core rates. “
Among the individual stocks to be monitored Pfizer. The big pharma USA has announced that it has reached a definitive agreement to take over the biopharmaceutical company Global Blood Therapeutics. Under the terms of the acquisition, Pfizer will put $ 68.5 per share on the plate, for a total enterprise value of approximately $ 5.4 billion (including debt and net of acquired cash). Both boards of the companies approved the transaction. Nvidia is also under the lens, losing more than 5% in the wake of lower-than-expected quarterly revenues.