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What to know this week

by Mark Mendoza

Investors in the week ahead will be closely watching a crucial inflation print and the start of third quarter earnings season. The economic highlight will be the release of the Consumer Price Index (CPI) for September on Thursday, which is expected to show a small decrease in headline inflation. The Federal Reserve’s September meeting minutes are also expected to provide further insight into the path forward for monetary policy. Additionally, a reading of consumer sentiment will close out the week.

On the corporate side, several major companies will be reporting their third quarter earnings, including Pepsi, Delta, JPMorgan, Citi, Wells Fargo, and BlackRock. These earnings reports will be closely watched as they will provide insights into the state of the consumer and the overall health of the US economy.

The stock market enters the week on a positive note, with the Nasdaq and S&P 500 posting strong gains last week. However, the Dow Jones Industrial Average fell slightly. The blowout September jobs report has further complicated the Federal Reserve’s next move. While the report showed strong job growth, it also raised concerns about inflationary pressures. Economists believe that the hot job market needs to be met with cooling inflation in order to avoid a recession.

The upcoming inflation print will be closely watched, with economists forecasting a decrease in headline inflation for September. Bets on the Fed hiking interest rates at the November meeting have increased following the release of the jobs report. However, the rise in bond yields over the past week could keep the Fed on pause in November, as some believe that the tightening in financial conditions may have already done the work of tightening credit.

Overall, the week ahead will be packed with economic data and earnings reports that will provide important insights into the state of the US economy and the direction of monetary policy. Investors will be closely watching for any signs of inflationary pressures and the impact on corporate earnings.

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