S&P 500 rose 2.7% on strong earnings, inflation data could lead to rate cuts

From Investing.com: 2024-04-27 05:47:47

The S&P 500 rose by 2.7% last week, driven by strong earnings from Microsoft and Alphabet, though Meta Platforms declined by over 10%. Companies beating earnings estimates only saw a 0.2% share outperformance, while those missing estimates underperformed by 4%, the largest gap in eight years.

Inflation data, including a 2.8% year-on-year increase in core PCE inflation for March, has economists predicting a July rate cut by the Federal Reserve, with up to 100 basis points of cuts expected this year. Spending data was strong in March, possibly prompting a June cut, according to Citi analysts.

Bank of America economists believe recent data indicates strong demand rather than “stagflation,” likely keeping the Fed on hold. The upcoming week includes earnings reports from Amazon and Apple, as well as the Federal Reserve releasing its monetary policy statement after a meeting.

Looking ahead, Navellier & Associates anticipates a significant impact from this week’s Federal Reserve meeting and FOMC statement. Fed interest rate cuts are expected to continue as Chairman Jerome Powell has indicated, but the future direction of the Fed remains uncertain.



Read more at Investing.com: What’s next for the S&P 500 after Friday’s inflation data By Investing.com