Week Ahead on Wall Street: Wind Down
By: Mario Ismailanji · March 04, 2024 · Reading Time: 4 minutes
Back to Basics
Earnings season is drawing to a close, as almost all S&P 500 companies have now reported Q4 results. So what did we learn? Earnings growth was strong, consumers have remained resilient, and artificial intelligence is still the talk of the town. Great. So what’s next?
It also depends on if you’re a glass half-full or half-empty kind of person. Half-full: Stocks are up ~7% in the first two months of the year, compared to the average annual gain of 8-10%. Half-empty: Stocks have been mostly flat after the initial pop on Nvidia’s earnings report on February 21, so maybe the rally is losing some steam.
With earnings done, investor attention will likely shift back toward the weekly drum of economic data, with the February jobs report due Friday being the highest profile release on the docket. Labor market data has attracted more eyeballs of late as the steady addition of jobs seemed to show no signs of slowing down. Combined with stronger than expected economic growth, it created the narrative that the Federal Reserve might have more wriggle room to delay anticipated rate cuts..
Speaking of the Fed, this is the final week before the central bank enters its communications blackout period ahead of the March 19-20 FOMC meeting, so expect Wall Street to pay attention for any final clues on the outlook. The most important commentary will almost certainly be Chair Jerome Powell’s testimony before the House Financial Services Committee and the Senate Banking Committee. Let’s see if we learn anything new this week.
Economic and Earnings Calendar
Monday
• Fedspeak: Philadelphia Fed President Patrick Harker will give a presentation on the economic impact of higher education.
• Earnings: Archer-Daniels-Midland (ADM)
Tuesday
• February ISM Services PMI: This index, released by the Institute for Supply Management, tracks how purchasing managers across different services industries feel about the business environment.
• Fedspeak: Fed Governor and Vice Chair of Supervision Michael Barr will participate in a panel discussion at the 2024 National Interagency Community Reinvestment Conference.
• Earnings: Ross Stores (ROST) and Target (TGT)
Wednesday
• February ADP Employment Report: This survey by ADP, often released a day or two before the official government jobs report, offers insight into private sector employment trends.
• January Job Openings: A key measure of business demand for labor is the number of job openings, since reducing openings is easier and preferable to layoffs.
• Fed Beige Book: This report is released eight times per year and tracks the state of the economy based on qualitative information.
• January Wholesale Inventories and Sales: Wholesalers often operate as an intermediary between manufacturers and retailers, serving as a key part of the goods supply chain.
• Weekly Mortgage Applications: Mortgage activity gives insight on demand conditions in the housing market.
• Fedspeak: Chair Jerome Powell will testify before the House Financial Services Committee and deliver the Semiannual Monetary Policy Report to Congress. San Francisco Fed President Mary Daly will give a keynote address at the 2024 National Interagency Community Reinvestment Conference. Minneapolis Fed President Neel Kashkari will speak at the Wall Street Journal’s CFO Network Summit.
• Earnings: Brown-Forman (BFB) and Campbell Soup (CPB)
Thursday
• February Challenger Job Cuts: The firm Challenger, Gray & Christmas tracks the number of layoff announcements each month by sector.
• January Consumer Credit: Borrowing activity gives insight into broader economic activity. It has trended lower as interest rates have risen, but is poised to turn higher.
• January Trade Balance: Trade, made up of exports and imports, is an important driver of economic activity.
• Weekly Jobless Claims: This high frequency labor market data gives insight into filings for unemployment benefits. Jobless claims have continued to show a labor market that remains strong despite having cooled.
• Fedspeak: Chair Jerome Powell will testify before the Senate Banking Committee and deliver the Semiannual Monetary Policy Report to Congress. Cleveland Fed President Loretta Mester will give a virtual speech on the economic outlook.
• Earnings: Broadcom (AVGO), Costco (COST), and Kroger (KR)
Friday
• February Employment Situation Summary: This blockbuster release from the Labor Department is released once a month and gives a comprehensive look at employment, wages, and hours worked.
• Fedspeak: New York Fed President John Williams will participate in a discussion hosted by the London School of Economics.
• Earnings: Oracle (ORCL)
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