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Market Keenly Awaits CPI Report

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Pre-market futures are lower at this hour — not as a reaction to any news ahead of the opening bell for the first trading day of a new week (there is none), but as something of an overhang from Friday’s cooling of bullish impulses. That said, this will be another meaningful week of economic prints and, yes, even more significant earnings reports.

Ahead of these details, the Dow is -164 points, the S&P 500 is -18 and the Nasdaq is -237 points. These indices, including the small-cap Russell 2000, are still notably in the green year to date, even after a slightly down week overall.

The biggest economic report expected this week comes tomorrow morning: the Consumer Price Index (CPI — aka “Consumer Price Inflation”) is expected to come down on the core (subtracting volatile food and energy prices) year over year by 20 basis points (bps) to +3.7%. For context, this would be easily the lowest print of the past year, and well off the September 2022 peak of +6.6%. However, we’re still a ways from the pre-Covid levels of +2.4% we saw in February of 2020.

Elsewhere this week, we’ll see fresh results from U.S. Retail Sales, Empire State and Philly Fed manufacturing, Import/Export Prices and Industrial Production/Capacity Utilization. None of these figures are likely to bring to bear action from the Fed, Wall Street, etc. as last week’s Jobs Week did. That said, while jobs numbers did incrementally loosen and cool as the Fed is looking for in order to eventually cut interest rates, market indices finished lower — selling the news in order to get a more realistic look at valuation.

And, while Q4 earnings season is essentially over, we will see off-quarter reports from a decent number of significant companies this week, which looks something like a remote “Earnings Island.” These include Archer Daniels Midland (ADM - Free Report) , Kohl’s (KSS - Free Report) , Dollar Tree (DLTR - Free Report) , Williams-Sonoma (WSM - Free Report) , Lennar Home (LEN - Free Report) , Dick’s Sporting Goods (DKS - Free Report) , Ulta (ULTA - Free Report) and Adobe (ADBE - Free Report) . This will bring us valuable insights across multiple sectors, roughly a month before Q1 earnings season begins with reports from the biggest banks on Wall Street.

After today’s close, software giant Oracle (ORCL - Free Report) reports fiscal Q3 results, where it will attempt to keep its string of five-straight positive earnings surprises intact. Going back several years, the Texas-based tech major had been an “Earnings All-Star,” so we know the company can feel its way around sturdy profitability. Earnings growth year over year is expected to come in +12.3%, with +7% revenues growth in the quarter. The company brings a Zacks Rank #3 (Hold) with a Style Score of D into the earnings report.

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