The Week Ahead: Markets Brace for PMI Data and Fed Talk This Week as Rate Cut Bets Rise

Market Overview

U.S. equities reversed lower last week, giving back recent gains as tariff concerns and weaker jobs data weighed on sentiment. The Dow fell -2.92% to close at 43,588.58, the Nasdaq lost -2.17% to 20,650.13, and the S&P 500 declined -2.36% to 6,238.01. Despite the pullback, all three indices remain positive year-to-date, led by the Nasdaq at +7.3%.

The week’s central theme is rising tariffs and softening labor data, both of which raise the odds of Fed policy action. The U.S. confirmed higher tariff rates averaging 18.3%, up from 2.4% at the start of the year, with new rates set to take effect August 7. Meanwhile, July’s nonfarm payrolls disappointed with just 73,000 jobs added vs. 104,000 expected, and the unemployment rate ticked up to 4.2%.

Despite the tariff headwind, Q2 earnings have broadly beaten expectations, with over 80% of S&P 500 companies topping estimates. Tech and AI names continue to lead, reinforcing growth leadership. Markets remain sensitive to Fed signals, particularly after Chair Powell acknowledged labor market softening and tariff uncertainty.

With Fed futures now pricing an 80% probability of a rate cut in September, traders will be watching for confirmation in this week’s Fed commentary and inflation prints.

Economic Releases & Notable Earnings

Monday (8/4)

• Earnings: PLTR (est. $0.14 EPS, $936.2M rev), IDXX ($2.44), TSN ($0.87), WAT ($2.63), ON ($0.96), W ($0.47), BNTX (-$3.36)

• Data: 14:00 GMT – Factory Orders m/m (-4.9%, prev 8.2%), Loan Officer Survey (tentative)

Tuesday (8/5)

• Earnings: CAT ($5.99), PFE ($0.60), MAR ($2.50), MPC ($4.12), TDG ($9.90), ZTS ($1.56), AMD ($0.69), ANET ($2.10), AMGN ($4.97)

• Data: 12:30 GMT – Trade Balance (-62.6B, prev -71.5B), 13:45 GMT – Final Services PMI (55.2, prev 55.2), 14:00 GMT – ISM Services PMI (51.5, prev 50.8), RCM/TIPP Economic Optimism (49.2, prev 48.6, tentative), 20:30 GMT – API Weekly Crude Stock

Wednesday (8/6)

• Earnings: DIS ($1.39), MCD ($2.97), WIX ($1.67), SHOP ($0.26), NYT ($0.45)

• Data: 14:30 GMT – Crude Oil Inventories (prev 7.7M), 17:01 GMT – 10-y Bond Auction (4.36|2.6)

• Fed Speakers: 18:00 GMT – Collins, 18:00 GMT – Cook, 20:10 GMT – Daly

Thursday (8/7)

• Earnings: CEG ($1.68), CROX ($4.01), LLY ($3.92), DDOG ($0.43), AKAM ($1.58), BLOCK ($0.67), TTWO (-$1.52)

• Data: 12:30 GMT – Initial Jobless Claims (221K, prev 218K), Prelim Nonfarm Productivity q/q (1.9%, prev -1.5%), Unit Labor Costs q/q (1.4%, prev 6.6%)

• 14:00 GMT – Final Wholesale Inventories m/m (0.2%), 16:00 GMT – Bostic Speaks, 14:30 GMT – Natural Gas Storage (prev 48B), 17:01 GMT – 30-y Bond Auction (4.89|2.4), 19:00 GMT – Consumer Credit m/m (7.2B, prev 5.1B)

Friday (8/8)

• Earnings: ENB ($0.58), WEN ($0.27), OTEX ($0.98), AMR ($4.49)

• Fed Speaker: 14:20 GMT – Musalem Speaks

Central Bank Activity

Fed Chair Powell reiterated caution around tariffs and labor softening, reinforcing a data-dependent stance. Market odds for a September cut rose sharply after last week’s jobs miss. This week features eight Fed speakers, including Daly, Bostic, and Bowman, who may provide further clues on timing and policy lean.

Technical Outlook

• Dow: Closed at 43,588.58 (-2.92%), pulling back sharply from resistance near 45,073.63. Key support lies near 41,981.14 with the 52-week SMA at 42,569.56.

• Nasdaq: Ended at 20,650.13 (-2.17%), below recent highs of 21,457.48. Initial support seen near 19,334.98, 52-week SMA at 18,766.01.

• S&P 500: Settled at 6,238.01 (-2.36%), off highs of 6,427.02. Watch 5,943.23 as support with 52-week SMA at 5,847.20.

Weekly structure remains constructive but vulnerable to further near-term pullbacks.

Outlook

Markets this week remain squarely focused on inflation, Fed signals, and key earnings. ISM Services and trade data kick off the week, followed by Fed commentary and Thursday’s labor cost figures. With September cut odds rising, investors are increasingly responsive to soft data.

Earnings from mega-cap and AI-linked names may continue to stabilize sentiment. However, tariffs and economic headwinds could keep rallies in check without dovish follow-through from the Fed.

More Information in our Economic Calendar.