The Week Ahead
Volatility came down quite a bit last week, but investors should still be on alert as the S&P500 sits near an important long-term technical inflection point (see tweet here). The economic calendar is much lighter this week, as is often the case following the monthly employment report, and earnings season is winding down. Still, several important announcements are on the docket. Given the global hypersensitivity to inflationary pressures, U.S. CPI is the most important release of the week. Will there be any signs of inflation easing after December’s surprise PPI drop? Expectations are for a 7.3% increase YoY for January, up from 7% the prior month. The bond market will absorb 10-year and 30-year Treasury auctions on the heels of yields rising to their highest levels in 2+ years. Other reports of note in the U.S. include consumer credit, trade balance, and consumer sentiment closes out the week. Earnings releases of note include Pfizer, Peloton, Disney, and Uber. On the international agenda, the spotlight will shine on the UK, with Q4 2021 GDP anticipated to have stagnated due to omicron restrictions. December’s unexpected dive in retail sales may have dented growth in what was shaping up to be a strong quarter.