What to Expect in the Markets Next Week

Coming up next week: more earnings, July inflation readings, consumer sentiment update

We’ll get earnings reports next week from Eli Lilly, UPS, The Walt Disney Company, Honda Motor Company, and Alibaba, among others. The Labor Department will release its latest inflation readings, with the Consumer Price Index (CPI) on Thursday and the Producer Price Index (PPI) on Friday. The New York Fed will issue its quarterly Household Debt and Credit Report on Wednesday, tracking how U.S. households fared financially in the second quarter. On Friday, we’ll get the preliminary August reading of the University of Michigan’s Consumer Sentiment Index (MCSI), along with a GDP reading out of the U.K.

Events Calendar:

Monday, August 7

• KKR & Company (KKR), Palantir Technologies (PLTR), BioNTech (BNTX), International Flavors & Fragrances (IFF), Coterra Energy (CTRA), Tyson Foods (TSN), Skyworks Solutions Inc. (SWKS), Lucid Group (LCID), Paramount Global (PARA), and Viatris Inc. (VTRS) report earnings
• Manheim Consulting Used Vehicle Price Index (Jul)
• China Trade Balance (Jul)

Tuesday, August 8

• Eli Lilly & Company (LLY), United Parcel Service (UPS), Zoetis Inc. (ZTS), Duke Energy Corp. (DUK), Li Auto (LI), GlobalFoundries Inc. (GFS), Sun Life Financial (SLF), Barrick Gold (GOLD), Take-Two Interactive Software (TTWO), and Rivian Automotive (RIVN) report earnings
• U.S. Trade Balance (Jun)
• Wholesale Inventories (Jun)
• NFIB Business Optimism Index (Jul)
• IBD/TIPP Economic Optimism Index (Aug)
• New York Fed Household Debt and Credit Report (Q2 2023)

Wednesday, August 9

• The Walt Disney Company (DIS), Honda Motor Company (HMC), Manulife Financial Corp. (MFC), Illumina (ILMN), Roblox Corporation (RBLX), U-Haul Holding Company (UHAL), and Charles River Laboratories International (CRL) report earnings

Thursday, August 10

• Alibaba Group (BABA), Brookfield Corporation (BN), Wheaton Precious Metals Corp. (WPM), News Corporation (NWS), and US Foods Holding Corp. (USFD) report earnings
• Consumer Price Index (CPI) Inflation Report (Jul)

Friday, August 11

• Spectrum Brands Holding Inc. (SPB) and Soho House & Co. (SHCO) reports earnings
• Producer Price Index (PPI) Inflation Report (Jul)
• University of Michigan Consumer Sentiment Index – Preliminary (Aug)
• U.K. Gross Domestic Product (GDP) – Preliminary Reading (Q2 2023)

The Latest Inflation Readings

We’ll get the latest updates on inflation next week, with the Consumer Price Index (CPI) on Thursday and the Producer Price Index (PPI) on Friday. Consumer prices likely rose 0.2% last month, matching June’s rate, and were likely up 3.3% on an annual basis. This would mark an acceleration from June’s 3% rate, which had a favorable year-over-year base effect as inflation peaked in June 2022. Core inflation, which excludes volatile food and energy costs, was likely unchanged at 4.8%, the slowest pace since October 2021.

On Friday, the Bureau of Labor Statistics (BLS) will issue the July PPI, tracking inflation from the standpoint of manufacturers and wholesalers. Producer prices are projected to have risen 0.2% last month, after rising 0.1% in June. Year-over-year, they were likely up 0.7%, compared to an annual gain of just 0.1% in June, which marked the smallest increase since a decline in August 2020.

Consumer Sentiment Update

On Friday, the University of Michigan will release the preliminary August reading of its Consumer Sentiment Index (MCSI), providing an update on consumer confidence. The index reading is projected at 71, down just slightly from 71.6 last month. July’s reading was the highest in two years, as consumers became more optimistic on the economy and their finances amid slowing inflation and a strong jobs market. While consumer sentiment is still well below pre-pandemic levels, it’s a stark reversal from last year, when the index hit an all-time low of 50 amid the highest inflation in four decades.

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