MARKET NEWS

Week Ahead on Wall Street

By: James Flippin · January 23, 2023 · Reading Time: 4 minutes

Economic Data

Today, the Conference Board will release December’s Leading Economic Index, which aims to forecast future economic activity. The index declined 1.0% in November, following a 0.9% drop the month before.

Tomorrow, three major purchasing managers’ indexes, or PMIs, will be released by S&P Global: Services, Composite, and Manufacturing. The Composite PMI hit 45 in December, signaling a strong monthly decrease in private sector business activity, led by drop-offs in manufacturing and services output. Overall, new business dropped the most it had since May 2020.

On Wednesday, the MBA 30-year mortgage rate will be released. This weekly interest rate metric hit 6.23% for the week ended January 13th, continuing its decline from its peak of 7.16% last October. This is a sign that inflation is continuing to level off.

Thursday will be a busy day, culminating as investors get advanced insight into the US GDP growth rate for the fourth quarter 2022. In Q3, the US economy grew at an annualized rate of 3.2% after shrinking for the previous two quarters.

Friday will give investors a look at how US consumers are faring, with December releases for personal income and spending. In November, personal income rose 0.4% from October while personal spending essentially stayed flat, increasing only by 0.1%.

Earnings

Today, oil field services company Baker Hughes (BKR) is scheduled to hold a conference call discussing its results for the fourth quarter and 2022 as a whole. Oil prices have been highly volatile over the past 12 months, a trend that has continued lately, as traders speculate as to what China’s post-COVID reopening will mean for energy demand.

Tomorrow, Microsoft (MSFT) will deliver an anticipated report. The tech giant may field questions regarding its investment and future plans for OpenAI’s ChatGPT, its ongoing acquisition of Activision Blizzard (ATVI), and its announcement last week to lay off 10,000 employees. Additionally, expect reports from major defense contractors Raytheon (RTX) and Lockheed Martin (LMT), as well as dominant conglomerates 3M (MMM) and General Electric (GE).

On Wednesday, Boeing (BA) will offer further insight into the defense industry. Meanwhile, Tesla (TSLA) will expand on its full year numbers after releasing the initial figures at the top of the year. The EV giant delivered over 1.3 million EVs in 2022, a year-over-year increase of 40%.

Thursday will shift investors’ eyes toward the turbulent air travel sector, with American Airlines (AAL), Southwest (LUV), and JetBlue (JBLU) all set to release their reports. All three companies will be expected to speak on the Department of Transportation’s decision to hold airlines accountable for canceled flights. Additionally, reports from the payment processing duopoly of Visa (V) and Mastercard (MA) will cast light on American spending habits.

On Friday, American Express (AXP) will build off its competitors’ reports, while Chevron (CVX) reflects on the oil industry’s highly-profitable 2022.

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