The previous week was quite volatile. The broad S&P 500 as the Nasdaq 100 continued to correct for the second week in a row. This time their capitalization decreased by 0.6-0.7%. Earlier, we noted that September is a historically weak month for US indices. However, if in September the S&P 500 at least once reached a historical maximum, then by the end of the month the indices closed with positive dynamics. At the very beginning of the month, the S&P 500 tested its all-time high at 4,540 points. Thus, according to statistics from 1950, the S&P 500 has every chance to move to growth in the second half of September.
Consumer prices in the United States in August rose by 5.3% compared to the same month last year. Thus, inflation has slowed down somewhat compared to the maximum value over the past thirteen years of 5.4%, which was recorded in June and July. The change in the CPI index in August coincided with the average forecast of analysts. Prices in August increased by 0.3% against the previous month. This is the lowest growth rate in the last seven months. Experts on average expected an increase of 0.4%. After the publication of statistics, noticeable purchases began on the market due to a slightly smaller than expected increase in prices, but this data is unlikely to change the intentions of the Federal Reserve System regarding the curtailment of stimulus measures in the near future.
The index of manufacturing activity in New York Empire Manufacturing in September jumped to 34.3 points from 18.3 points a month earlier against the market forecast of 18 points. The volume of industrial production in the United States in August increased by 0.4% compared with the previous month. The result was in line with the average forecast of analysts. The price index for goods and services imported to the United States fell 0.3% in August versus the previous month. This is the first decline in the indicator over the past ten months. The consensus forecast was for a similar increase.
US retail sales rose 0.7% in August from the previous month, which came as a surprise to analysts, who on average had expected a 0.8% decline. However, the unexpected growth in retail sales last month was partially offset by the fact that the July data was revised downward. This had a deterrent effect on the market, experts say. Fears that worsening consumer sentiment will lead to a decline in retail sales have not yet been confirmed. Other indicators released at the same time as the sales report also give hope for the best.
The main event this week will be the two-day Fed meeting from Tuesday to Wednesday. The market does not expect that the regulator will announce the curtailment of the program of redemption of bonds from the market, however, it will be important to hear how the tone of comments from FRS representatives has changed, especially from Chairman Jerome Powell. According to the market consensus, the Fed will announce the withdrawal of stimulus in November. The regulator may raise the rate twice in 2023. On Tuesday, statistics on the US new home market will be published. On Wednesday, there will be data on secondary sales in the US housing market. Powell will kick off a “Fed Listening” event on Friday on the outlook for post-pandemic recovery with Fed Vice Chair Richard Clarida, member of the Fed’s Board of Governors