Global Highlights for This Week: US CPI Report Takes Center Stage, Apple Fall Event Arrives
Last week, the three major US stock indices showed mixed performance: the Dow fell 0.32%, the S&P rose 0.33%, and the Nasdaq Composite gained 1.14%. The Nasdaq’s strength was driven by robust performances from non-Dow components like Google and Broadcom.
On Thursday, the S&P 500 closed at a record high, marking its 21st new high this year. However, Friday’s worsening employment data heightened concerns about a slowdown in US economic momentum, causing all three indices to retreat.
The softening labor market has bolstered expectations of a Federal Reserve rate cut. The CME’s “FedWatch” tool indicates an 89% probability of a 25 basis point cut at the September meeting, with the remaining 11% anticipating a 50 basis point reduction.
However, some Fed officials argue there’s no reason to lower rates this month. For instance, Cleveland Fed President Hammack reiterated that current data shows inflation remains above the 2% target and is trending upward, posing challenges for low-income households.
Looking ahead to this week, the most significant economic data will be the US CPI report, which could trigger notable market volatility. Investors will closely monitor whether Trump’s tariffs have driven up prices; if inflation exceeds expectations, it could dampen optimism for rate cuts.
Additionally, the PPI report may shed light on the impact of US import tariffs. Art Hogan, Chief Market Strategist at B Riley Wealth, noted that only a “severely high” CPI reading might undermine the assumption of an imminent Fed policy easing.
Earlier this year, tariffs and their economic impact were the primary risks facing financial markets, but recently, questions about Fed independence and caution around AI trading have also gained prominence.
Investors will see Apple’s fall event on September 10, themed “Ahead, Highly Charged.” Renowned leaker Mark Gurman predicts the tech giant will unveil updates to the latest iPhone, AirPods, and Apple Watch.
Overview of Key Overseas Economic Events This Week:
Monday: Eurozone September Sentix Investor Confidence Index, US August New York Fed 1-Year Inflation Expectations
Tuesday: US August NFIB Small Business Confidence Index, US Bureau of Labor Statistics releases annual nonfarm benchmark revision data
Wednesday: EIA releases Monthly Short-Term Energy Outlook, Apple fall product launch event, US August PPI year-over-year, US EIA crude oil inventories for the week ending September 5
Thursday: IEA releases Monthly Oil Market Report, ECB announces interest rate decision, US August unadjusted CPI year-over-year, US initial jobless claims for the week ending September 6
Friday: US September University of Michigan Consumer Confidence Index preliminary value/1-year inflation expectations preliminary value