×
News Home

Markets Rise Monday as Biden Reconsiders Tariffs on China; ECB to Raise Interest Rates in July

Monday, May 23, 2022 04:45 PM | Neal Farmer
Markets Rise Monday as Biden Reconsiders Tariffs on China; ECB to Raise Interest Rates in July

Markets rose to start the week after comments from President Joe Biden that he would reconsider the tariffs on China originally imposed by President Trump. The yuan advanced after the news. The euro gained ground Monday as well with European Central Bank (ECB) Chief Christine Lagarde saying interest rates will rise in July. The central bank is also expected to exit negative interest rates by September.

Looking forward to the week, investors await a heavy economic data dump on Friday with April Personal Consumption Expenditures (PCE) on the docket that morning. The PCE report is the Federal Reserve’s preferred method of gauging inflation. Meanwhile, earnings results are packed throughout the week with several big names set to report.

Economic Developments

The April PCE report on Friday is the highlight of the week with overall prices expected to rise 0.3% following a 0.9% jump in March. Excluding food and energy, core prices are also projected to rise 0.3%, matching its increase from the previous month. Core and overall prices are estimated to have risen at the same rate, closing March’s wide spread between the two.

The PCE report is also expected to show personal income and spending rise 0.5% and 0.6%, respectively, in April. Spending is projected to match March’s rise of 0.5% while personal income is expected to slow from a 1.1% jump the previous month.

Outside of the PCE report, plenty of data is set to drop this week including New Home Sales, Durable Goods Orders, the second estimate for Q1 GDP, and weekly unemployment claims. 750,000 new home sales are expected in April, down slightly from 763,000 in March. Durable orders are projected to have increased 0.6% last month following a 0.8% jump in March. Meanwhile, the second estimate for the first-quarter GDP is a 1.3% decrease. Lastly, initial unemployment claims are projected to fall from 218,000 to 210,000 new claims for the week ending May 21.

Earnings Continue

Some big names have yet to report quarterly earnings including Best Buy (BBY), Intuit (INTU), Nvidia (NVDA), Alibaba (BABA), Costco (COST), and Dell (DELL) among others. Leading Canadian banks are also scheduled to report this week with Bank of Nova Scotia (BNS), Bank of Montreal (BMO), Royal Bank of Canada (RY), and Toronto-Dominion Bank (TD) all set to release quarterly numbers.

Alibaba, Nvidia, Dell, and Best Buy are all expected to report significantly lower earnings-per-share (EPS) than their respective year-ago quarters with Zoom (ZM) unsurprisingly joining that elite club as the company struggles to reach where it was earlier in the pandemic. Intuit and Costco are meanwhile projected to report higher EPS this most recent quarter compared to last year. The Canadian banks are mixed with the Bank of Nova Scotia and Montreal both expected to report slightly higher earnings-per-share, and the Royal Bank of Canada and Toronto-Dominion both projected to report a slightly worse EPS than their year-ago quarters.

Economic Events this Week

Tuesday

- 10:00 a.m. - New Home Sales

Wednesday

- 8:30 a.m. - Durable Orders

- 10:30 a.m.- EIA Crude Oil Inventories

- 2:00 p.m. - FOMC Minutes

Thursday

- 8:30 a.m. - GDP-Second Estimate

- 8:30 a.m. - Initial & Continuing Claims

- 10:30 a.m. - EIA Natural Gas Inventories

Friday

- 8:30 a.m. - PCE Prices

- 8:30 a.m. - Personal Income & Spending

Earnings Reports This Week

Tuesday:

Before the bell:

NTES, BBY, AZO, DOLE, RL, WOOF, CSIQ

After the bell:

INTU, JWN, TOL, A, URBN, CAL, RAMP

Wednesday:

Before the bell:

BNS, BMO, DKS, DY, CMCO, PLAB

After the bell:

NVDA, DXC, WSM, CHNG, ENS, VSAT, SPLK, GES, SNOW, NTNX

Thursday:

Before the bell:

BABA, BIDU, RY, TD, DG, MDT, DLTR, M, CM, BURL, BZUN, GCO, AMWD

After the bell:

COST, DELL, GPS, VMW, ULTA, MRVL, WDAY, ADSK, AEO, FTCH, RRGB

Friday:

Before the bell:

BIG, HIBB, CGC

Sector and Industry Sentiment

You can now see which sectors and industries are performing best for each of our metrics using our new Sector and Industry Analysis tools.

You May Also Like

Get the InvestorsObserver App

InvestorsObserver App
iOS App Android App