It’s a busy summer week with all manner of potentially highly impactful global macroeconomic indicators to influence central banks in the US, China, UK and Australia. Highlights Stateside include the latest CPI figures, plus a steer on the consumer with retail sales activity. Economists have long predicted a rise in inflation due to tariffs, so will we finally see some impact show up in the consumer prices data? The July, August and September CPI reports are expected to show a clear influence. This will in turn be important for the Fed, with the majority of officials very much in wait-and-see mode. This puts further pressure on Chair Powell, especially from President Trump, with much speculation recently about the policymaker’s position. This could grab a lot of headlines this week amid ongoing tariff chatter regarding fresh 30%+ EU and Mexico levies.
The Q2 earnings season begins in earnest over the next few days. About forty S&P500 firms release results and perhaps guidance with the latter depending on the firm. Banks will be in focus with JP Morgan, Citigroup, Bank of America, Goldman Sachs and Morgan Stanley all publishing their results this week, along with key names like Netflix and Amex. As always, key will be earnings relative to their expectations, which have been revised lower over time especially for energy and consumer discretionary stocks. How much faith will markets have in any guidance given, amid heightened uncertainty and prior suspension of guidance?