Big focus this week

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The main focus this week for investors will be inflation data, with the Producer Price Index due to be released today and the Consumer Price Index due to be released tomorrow. Inflation is expected to have hit its highest level in thirty years due to rising energy costs and supply chain bottlenecks. The producer and consumer price indices are expected to have risen 0.6% month-on-month in October.

Still, the growth outlook for the S&P 500 remains high, boosted by strong third-quarter corporate earnings, which jumped 40% year-on-year. As a result, rather than worrying about rising inflation, securities traders try to profit from it.

In addition, encouraging news has flooded the markets in recent days, including the ratification of a $ 550 billion infrastructure program as the Federal Reserve prepares to begin unwinding its previous stimulus. The move by Washington helped allay market fears that the reduction in quantitative easing measures, along with rapidly rising consumer prices, will stifle economic development. Indeed, infrastructure spending is crucial because it increases a country’s potential to be more productive and generate a favorable return on investment in the years to come. As a result, the industrial sector of the S&P 500 finished at all-time highs.

In addition, Pfizer’s COVID-19 pill and the lifting of travel restrictions in the United States have boosted market confidence that companies will continue to enjoy strong profitability in the fourth quarter.


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