Title: What to Expect from Markets in the Week of July 24th
As we enter the final week of July, market participants are bracing themselves for potential volatility amid low trading volumes. The weather seems to mirror the mood, with beautiful sunsets in the West and ominous storm clouds gathering in the East, reminiscent of scenes from The Wizard of Oz. These contrasting elements create a unique backdrop for the week ahead.
Although the past week may have been uneventful in terms of market fireworks, investors have their eyes fixed on the upcoming Nasdaq-100 rebalancing on Monday. Additionally, there is much anticipation regarding the significant influx of capital into the artificial intelligence sector, prompting a special briefing on Wednesday to explore the lesser-known companies with the most potential.
However, it’s not all smooth sailing ahead. Critical supply chain issues loom, which could have a substantial impact on various industries. Furthermore, the Federal Reserve is scheduled to provide a policy update on Wednesday, where interest rates are expected to be raised by 25 basis points. This decision will be of utmost importance to market participants who eagerly await Federal Chair Jerome Powell’s statement, which historically triggers an interesting market reaction.
Turning our attention to corporate earnings reports, Tuesday will see attention shift back to the Nasdaq as technology giants Microsoft and Alphabet announce their financial results. Concurrently, the Federal Reserve’s meeting begins, and market participants will eagerly await the weekly update on U.S. oil inventory levels. These factors are likely to shape market sentiment as the week progresses.
Thursday will be another crucial day as the earnings reports of Mastercard and McDonald’s will provide valuable insights into consumer spending levels. Investors will also closely monitor AbbVie’s progress in replacing lost revenue from its Humira drug. AbbVie, a constituent of the Five Stocks to Own Forever portfolio, has been a focal point for investors seeking long-term growth. Additionally, the European Central Bank’s decision to raise interest rates again will be closely watched to assess its impact on the market.
Friday will be dominated by the energy sector, with earnings reports from Chevron and Exxon. The market will be keen to gauge their performance and gain a better understanding of the global oil and gas market. Chevron, in particular, is expected to demonstrate strong momentum in its report, shedding light on its operations in the Permian Basin.
To better guide market participants, a small but significant change has been made to Postcards. A box now indicates the momentum across three indices, providing a snapshot of market conditions. Currently, the momentum is strong (green) across the board, reflecting positive market sentiment fueled by robust global liquidity and capital flows.
As we navigate through the week, it will be important to remain attentive to any developments that may unsettle the markets. Any shifts in the indicated momentum towards yellow or red may signal a potential time for profit-taking or position hedging. All in all, market participants are bracing themselves for a week that promises both challenges and opportunities, as volatility and potential market-moving events lie on the horizon.
