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Pre-market futures are tepid at this hour, following a third-straight up-week ending with all-time closing highs for the Nasdaq and the S&P 500. Currently, the Dow is +14 points but the S&P is -3; the Nasdaq is -33 points right now while the small-cap Russell 2000 is +7.
Last week’s Jobs Week illustrated a four-month trailing average of new jobs created equaling the previous four-month average, at right around +150K. This is much lighter than we saw in the post-Covid Great Reopening, but still demonstrating growth even with 100K or so retirees exiting the labor force each month.
However, a second Trump presidential term may aggravate employment going forward, depending how aggressive the administration is with removing undocumented immigrants (most of whom are employed), and reducing headcount in government employment via the Elon Musk/Vivek Ramaswamy-proposed Department of Government Efficiency. These measures are months away from having material effects, at the earliest, but they are developments worth considering moving into 2025.
Inflation Report Mid-Week: 7 Days Ahead of the Fed
On Wednesday morning, we’ll see the November Consumer Price Index (CPI) report released, complete with a new Inflation Rate (headline year over year). Expectations are for this to tick up from +2.6% to +2.7% from the prior month, which is the opposite direction of where the Fed wants to see inflation move. The core print year over year, on the other hand, is expected to tick down from +3.3% to +3.2%. This is more the right idea, but still farther from the optimal +2.0% inflation rate the Fed has been seeking for years now.
A week from Wednesday brings us the next Federal Open Market Committee (FOMC) meeting decision on interest rates. Despite stronger-than-predicted jobs numbers reported last week, the expected 25 basis-point (bps) cut — to a Fed funds rate between +4.25-4.50%, where we haven’t been for nearly two years — appears to remain on schedule.
About the only thing that may shake the Fed from its current trajectory of lowering interest rates ahead of next week would be this forthcoming CPI number. For a pause to prevail, we’d likely have to see a relatively hot Inflation Rate — up to +3% or higher. If this were to be the case, expect to see a “leak” in the press about this move; currently the Fed in in a media “blackout period” that lasts until after the FOMC data is released.
Earnings After the Bell: ORCL, AI, TOL and More
Just when we think we’re done with earnings reports, we’ll hear from Oracle (ORCL - Free Report) this afternoon. Expectations are for +10.45% earnings growth on revenues anticipated to increase +9% year over year. The software-producing giant has outperformed earnings expectations in three of the past four quarters. The company brings a Zacks Rank #3 (Hold) into this afternoon’s report.
We’ll also hear from enterprise AI company C3.ai (AI - Free Report) , which carries a Zacks Rank #2 (Buy) into today’s report. Earnings are expected to be -23% to the negative as the company spends to increase capacity, with revenues anticipated to come in +24%.
Also, luxury homebuilder Toll Brothers (TOL - Free Report) and Midwestern convenience store operator Casey’s General Stores (CASY - Free Report) report fiscal Q4 and Q2 numbers after today’s close, respectively. Both currently have Zacks Rank #3s going into the prints.
Image: Bigstock
Pre-Markets Quiet Ahead of CPI Report Mid-Week
Monday, December 9, 2024
Pre-market futures are tepid at this hour, following a third-straight up-week ending with all-time closing highs for the Nasdaq and the S&P 500. Currently, the Dow is +14 points but the S&P is -3; the Nasdaq is -33 points right now while the small-cap Russell 2000 is +7.
Last week’s Jobs Week illustrated a four-month trailing average of new jobs created equaling the previous four-month average, at right around +150K. This is much lighter than we saw in the post-Covid Great Reopening, but still demonstrating growth even with 100K or so retirees exiting the labor force each month.
However, a second Trump presidential term may aggravate employment going forward, depending how aggressive the administration is with removing undocumented immigrants (most of whom are employed), and reducing headcount in government employment via the Elon Musk/Vivek Ramaswamy-proposed Department of Government Efficiency. These measures are months away from having material effects, at the earliest, but they are developments worth considering moving into 2025.
Inflation Report Mid-Week: 7 Days Ahead of the Fed
On Wednesday morning, we’ll see the November Consumer Price Index (CPI) report released, complete with a new Inflation Rate (headline year over year). Expectations are for this to tick up from +2.6% to +2.7% from the prior month, which is the opposite direction of where the Fed wants to see inflation move. The core print year over year, on the other hand, is expected to tick down from +3.3% to +3.2%. This is more the right idea, but still farther from the optimal +2.0% inflation rate the Fed has been seeking for years now.
A week from Wednesday brings us the next Federal Open Market Committee (FOMC) meeting decision on interest rates. Despite stronger-than-predicted jobs numbers reported last week, the expected 25 basis-point (bps) cut — to a Fed funds rate between +4.25-4.50%, where we haven’t been for nearly two years — appears to remain on schedule.
About the only thing that may shake the Fed from its current trajectory of lowering interest rates ahead of next week would be this forthcoming CPI number. For a pause to prevail, we’d likely have to see a relatively hot Inflation Rate — up to +3% or higher. If this were to be the case, expect to see a “leak” in the press about this move; currently the Fed in in a media “blackout period” that lasts until after the FOMC data is released.
Earnings After the Bell: ORCL, AI, TOL and More
Just when we think we’re done with earnings reports, we’ll hear from Oracle (ORCL - Free Report) this afternoon. Expectations are for +10.45% earnings growth on revenues anticipated to increase +9% year over year. The software-producing giant has outperformed earnings expectations in three of the past four quarters. The company brings a Zacks Rank #3 (Hold) into this afternoon’s report.
Check out the updated Zacks Earnings Calendar here.
We’ll also hear from enterprise AI company C3.ai (AI - Free Report) , which carries a Zacks Rank #2 (Buy) into today’s report. Earnings are expected to be -23% to the negative as the company spends to increase capacity, with revenues anticipated to come in +24%.
Also, luxury homebuilder Toll Brothers (TOL - Free Report) and Midwestern convenience store operator Casey’s General Stores (CASY - Free Report) report fiscal Q4 and Q2 numbers after today’s close, respectively. Both currently have Zacks Rank #3s going into the prints.
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