The
next
rate
decision
from
the
Federal
Reserve
coupled
with
May
inflation
data,
both
on
Wednesday,
will
play
key
roles
in
how
stocks
perform
next
week
—
quite
probably
lending
added
volatility
to
an
already
jittery
market.
Stocks
look
poised
to
cap
off
the
first
winning
week
of
June
on
a
positive
note,
with
Nvidia
powering
the
market
to
new
highs
to
briefly
break
above
a
$3
trillion
market
capitalization
and
temporarily
unseat
Apple
as
the
second
most
valuable
company
after
Microsoft.
Meanwhile,
GameStop
first
rallied
and
then
pulled
back
in
continued
wild
fluctuations
for
the
meme
stock.
Investors
continued
to
hunt
for
signs
of
a
cooldown
in
the
labor
market
in
the
hopes
that
a
slowing
economy
might
encourage
the
Fed
to
cut
rates,
but
a
hotter-than-expected
nonfarm
payrolls
report
for
May
dashed
hopes
for
any
easing
in
the
near
future.
The
payrolls
report
released
Friday
showed
the
economy
add
272,000
jobs
in
May,
blowing
past
economists’
consensus
forecast
of
a
190,000
increase,
according
to
a
Dow
Jones
survey.
May’s
increase
was
also
far
above
April’s
175,000
new
jobs.
T
he
unemployment
rate
ticked
up
to
4%
for
the
first
time
since
2022
as
more
workers
joined
the
labor
force.
The
results
are
likely
to
complicate
Wednesday’s
Federal
Reserve
policy
meeting
and,
critically,
further
push
out
the
timeline
for
cuts.
“Today’s
data
puts
into
question
that
if
we
get
numbers
that
are
just
in
line
with
expectations
–
no
clear
path
–
or
a
surprise,
that
we
might
just
get
another
cautious
statement”
from
central
bank
governors,
said
Kathryn
Kaminski,
chief
research
strategist
and
portfolio
manager
at
AlphaSimplex
Group.
The
Fed’s
rate
decision
All
eyes
are
on
the
Fed
next
week
and
its
rate
decision
that’s
set
to
come
down
at
2
p.m.
Wednesday.
The
pressure
is
on
Federal
Open
Market
Committee
members
after
the
European
Central
Bank
cut
interest
rates
this
week
for
the
first
time
since
2019
despite
persistent
inflationary
pressures
in
the
European
Union.
More
critical
than
the
rate
decision
itself
next
week
will
be
the
Fed’s
updated
projections
on
interest
rates,
and
the
timing
of
cuts.
That’s
likely
to
drive
the
market
in
the
week
ahead,
according
to
Wells
Fargo
Investment
Institute’s
senior
global
market
strategist
Scott
Wren.
In
March,
the
last
time
the
Fed
released
what’s
known
updated
projections,
policymakers
called
for
at
least
three
cuts
in
2024.
But
investors
have
tempered
expectations
since
then
amid
a
spate
of
stubborn
inflation
data.
“I
want
to
see
that
the
Fed
doesn’t
say
anything
that
suggests
that
they’ve
shut
the
door
on
a
rate
cut
in
July
and
that
it’s
still
a
possibility,”
said
Wilmington
Trust’s
chief
investment
officer
Tony
Roth,
noting
that
the
market
will
get
two
more
readings
on
the
personal
consumption
expenditure
price
index
—
the
Fed’s
preferred
inflation
gauge
—
ahead
of
the
July
meeting.
Trading
in
fed
funds
futures
are
now
pricing
in
a
54%
chance
of
a
cut
in
September
and
nearly
90%
odds
of
easing
in
December,
according
to
the
CME
Group’s
FedWatch
too
l.
Any
inkling
next
week
that
a
rate
cut
could
come
earlier
–
such
as
September
–
will
prove
a
dovish
signal
to
the
market,
said
Envestnet’s
Dana
D’Auria.
Investors
want
to
hear
language
from
the
Fed
next
week
that
suggests
it’s
open
to
start
cutting
rates
in
September
and
that
inflation
has
not
proven
intractable,
forcing
a
delay
in
easier
policy
until
the
end
of
2024,
said
D’Auria,
the
firm’s
co-chief
investment
officer.
May
CPI
report
Sticky
inflation
data
has
fueled
months-long
concern
that
the
Fed
will
keep
fed
funds
at
their
current
5.25%
to
5.50%
pending
additional
evidence
that
inflation
is
in
hand,
and
that
any
easing
in
policy
will
come
much
later
than
previously
expected.
That
makes
May’s
consumer
price
index
report
due
out
before
the
bell
Wednesday
another
key
focal
point
for
investors.
Economists
polled
by
Dow
Jones
are
bracing
for
the
consumer
price
index
to
rise
3.4%
year
over
year
and
0.1%
on
a
monthly
basis.
Core
CPI,
which
excludes
food
and
energy,
is
expected
to
also
gain
3.4%
year
over
year,
but
0.3%
on
the
month.
“The
Fed
has
said
it
needs
to
be
convinced
that
both
inflation
and
labor-market
data
are
cooling,”
Wells
Fargo’s
Wren
said
in
a
note
to
clients.
“That
means
more
than
a
month
or
two
of
lower
inflation
readings.
The
problem
is
the
latest
data
show
only
tentative
and
early
signs
of
such
a
move.”
Apple’s
developer
conference
Iinvestor
attention
will
also
keep
a
close
watch
on
Apple’s
Worldwide
Developers
Conference
Monday
in
Cupertino,
California,
where
the
iPhone
maker
is
widely
expected
to
announce
its
latest
software
updates.
The
heat
is
on
Apple
to
reveal
an
AI
agenda
as
investors
continue
to
favor
companies
with
a
clear-cut
plan.
Apple’s
AI
monetization
strategy
has
been
shrouded
in
mystery
compared
to
competitors,
fueling
some
investor
fear
that
Apple
is
falling
behind.
“That’s
an
event
that’s
going
to
have
pretty
important
implications
for
the
tech
sector
broadly,”
said
Gabelli
Funds’
John
Belton.
The
portfolio
manager
expects
Apple
to
announce
new
AI
integration
for
its
iPhone
model,
and
potentially
test
out
some
new
features
built
into
apps
such
as
Notes
and
Safari.
Apple
may
also
hint
at
plans
to
develop
its
own
data
center
chips,
he
added.
Week
ahead
calendar
Monday,
June
10
1
p.m.:
3-year
Treasury
note
auction
Tuesday,
June
11
6
a.m.:
NFIB
Small
Business
Index
(May)
1
p.m.:
10-year
Treasury
note
auction
Earnings:
Casey’s
General
Stores
Wednesday,
June
12
7
a.m.:
Weekly
mortgage
applications
(week
ended
June
7)
8:30
a.m.:
Consumer
price
index
(May)
2
p.m.:
FOMC
policy
announcement
2:30
p.m.:
Fed
Chair
Jerome
Powell
holds
news
conference
Earnings:
Broadcom,
Dave
&
Buster’s
Thursday,
June
13
8:30
a.m.:
Weekly
jobless
claims
(week
ended
June
8)
8:30
a.m.:
Producer
price
index
(May)
1
p.m.:
30-year
Treasury
bond
auction
Earnings:
Adobe,
Signet
Jewelers,
John
Wiley
Friday,
June
14
8:30
a.m.:
Import/export
prices
(May)
10
a.m.:
University
of
Michigan
consumer
sentiment
index
(preliminary,
June)
