Stocks Rise as Inflation Data Bolsters Rate Cut Hopes
Market Highlights
* S&P 500 reached a record high on positive inflation news.
* Nasdaq Composite surged over 2.5%, S&P 500 gained 1.5%.
* Dow Jones Industrial Average rose 0.5%.
Economic News Expected
* Minutes from the Federal Reserve's January meeting.
* Updates on manufacturing, services, and consumer sentiment.
* Quarterly reports from Alibaba and Walmart.
Inflation Signals
* Recent inflation readings indicate a potential slowdown in price increases.
* "Core" PCE inflation forecast to decline in January.
* Markets anticipate one or two interest rate cuts from the Fed in 2025.
Fed Policy Outlook
* Fed's January meeting minutes may provide insights on rate hike/cut decision.
* Many economists expect rate cuts rather than hikes.
Market Breadth
* 48% of S&P 500 companies outperforming the index in 2025.
* Participation indicates market strength but may not guarantee index growth.
AI Trade
* Palantir and Super Micro Computer are top performers in the S&P 500 in 2025, driven by AI euphoria.
* Nvidia's equity holdings adjustments triggered shifts in AI stocks.
Weekly Economic Calendar
Monday
* Markets closed for Presidents' Day.
Tuesday
* Empire Manufacturing Index
* NAHB Housing Market Index
* Earnings: Devon Energy, Oxy, Toll Brothers
Wednesday
* MBA Mortgage Applications
* Housing Starts
* Building Permits
* FOMC Meeting Minutes (January)
* Earnings: Carvana, Cheesecake Factory, Etsy, Garmin, Toast, Wingstop
Thursday
* Initial Jobless Claims
* Philadelphia Fed Business Outlook
* Leading Index
* Earnings: Alibaba Group, Walmart, Block, Booking Holdings, Rivian, Shake Shack, Unity, Texas Roadhouse, Dropbox
Friday
* S&P Global US Manufacturing PMI
* S&P Global US Services PMI
* S&P Global US Composite PMI
* University of Michigan Consumer Sentiment Index
* No notable earnings releases.