Author: Zac Martin, Senior Investment Analyst
Week Ending July 10th – Closed, Again
Another week of minimal macro news to drive markets, with the notable exception being the revamped retaliatory US strikes into Iran. Oil markets climbed and the broader market declined while the tech heavy, and therefore less geopolitically sensitive, S&P 500 ended the week higher. While a resolution to the conflict continues to elude negotiators, the market has seemingly already discounted any prolonged effects back in March. Therefore, any new geopolitical developments related to Iran have had a lessened effect on the current market environment. Additionally, the FOMC released the minutes for the recent June meeting. Despite the unanimous decision to keep rates unchanged, the committee remains divided regarding the path of rates and inflation. For example, several members have cited the AI buildout as a source of more long-term and structural inflation, while Fed Chair Warsh has stated that AI is likely to be disinflationary due to the productivity gains. Time will tell, but with a divided Fed, interest rates are likely to remain volatile.
Looking ahead, this week the major US banks will kick off earnings season; therefore, the recent lull in the economic news cycle is likely to end.
The Week Ahead:
- Earnings Season Kick off (7/14)
- Consumer Price Index (7/14)
- Producer Price Index (7/15)
- Retail Sales (7/16)
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