The Market News Today: Fed Speakers Highlight Shortened Week

Fed Comments, Housing Data, and Earnings to Shape Investor Sentiment This Week

In a holiday-shortened week, investors will monitor Federal Reserve comments and economic data to gauge inflation trends. Key housing market data, including existing home sales, housing starts, and homebuilder confidence, will be released. Lennar and KB Home report earnings, providing insights into the real estate sector. Kroger will report financials amid its merger with Albertsons. The week also features Federal Reserve officials discussing economic conditions and potential interest rate cuts. Markets close Wednesday for Juneteenth.

Kashkari Predicts Possible Fed Rate Cut in December

Minneapolis Fed President Neel Kashkari indicated a potential interest rate cut in December, contingent on inflation trends. The Fed aims to lower inflation to 2%, holding the current rate at 5.25%-5.50% since last July. Kashkari emphasized the need for more data before making decisions. He acknowledged the strong job market but anticipates further cooling. Kashkari noted high borrowing costs impact homebuyers but stressed that controlling inflation is crucial for long-term affordability.

China’s Retail Sales Beat Expectations in May

China’s retail sales surged 3.7% in May, surpassing expectations. However, industrial output and fixed asset investment lagged behind forecasts. Industrial output increased 5.6% year-on-year, and fixed asset investment grew by 4%. The urban unemployment rate remained steady at 5%. Despite a 7.6% rise in exports, imports and loan growth underperformed. Inflation data showed a 0.6% increase in consumer prices excluding food and energy.

Stock Futures Steady Ahead of Shortened Week

Stock futures remained steady on Monday as traders enter a holiday-shortened week. For the week, the Dow posted its third losing week in four, while the S&P and Nasdaq marked their seventh positive week in eight, driven by tech. This week, investors focus on retail sales, home sales, and housing starts data, alongside earnings reports from Lennar, Kroger, Darden Restaurants, and CarMax. Markets will be closed on Wednesday for the Juneteenth holiday.

Crude Oil and Gold Markets See Mixed Movements

Oil prices slipped on Monday due to weaker U.S. consumer demand and increased Chinese production, despite a 4% weekly gain. Gold prices eased as investors await U.S. economic data, with recent reports hinting at stabilizing inflation. Analysts foresee potential benefits for gold if the U.S. dollar weakens and rate cut expectations rise. U.S. retail sales data, weekly jobless claims, and flash PMIs will be key indicators this week. Concerns about Middle East tensions also persist.