What to Watch This Week as Warsh Testifies and Bank Earnings Flood In
Federal Reserve Chair Kevin Warsh testifies earlier than Congress twice this week, his first time as chair. His testimony coincides with a wave of main financial institution earnings and recent inflation information.
The overlap creates one of many 12 months’s most carefully watched weeks for markets.
Warsh’s Testimony and Inflation Data
Warsh appears earlier than the House Financial Services Committee on Tuesday, July 14, hours after the June Consumer Price Index report lands. He then testifies earlier than the Senate Banking Committee on Wednesday, following the Producer Price Index launch.
Both readings will form how lawmakers interpret his stance on charges. The testimony follows Warsh’s first FOMC meeting in June the place officers signaled openness to a fee hike if inflation stays elevated.
His remarks additionally arrive after economists trimmed recession odds whereas elevating inflation forecasts. That mixture leaves the Fed little room to ease coverage this 12 months. Warsh inherited the function from his predecessor’s last FOMC assembly, which left him a sticky inflation image and a unstable power market.
Bank Earnings Test Economic Health
JPMorgan, Bank of America, Wells Fargo, Goldman Sachs, and Citigroup all report their earnings Tuesday. The outcomes give traders an early learn on mortgage demand and credit score high quality.
Net curiosity margins and mortgage loss provisions may even draw shut consideration. The experiences observe banks clearing the Fed’s annual stress test with capital ranges intact.
Rest of the Week’s Wave of Things to Watch
Morgan Stanley, Johnson & Johnson, ASML, and United Airlines report Wednesday. Morgan Stanley presents an funding banking view, whereas ASML’s order e-book will sign AI-driven chip demand.
Taiwan Semiconductor, Netflix, UnitedHealth, and GE Aerospace observe on Thursday. TSMC’s outcomes carry specific weight after a stretch through which semiconductor stocks outpaced Big Tech. Netflix will check subscriber progress towards a more durable streaming market, and UnitedHealth faces continued scrutiny over medical price traits.
Thursday additionally brings June retail gross sales information. The studying presents a last shopper well being examine for the week. It arrives as markets weigh inflation threat towards progress considerations throughout a interval of sector rotation toward defensive names.
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