Wall Street begins a week marked by inflation with soft purchases

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Soft buying on Wall Street behind the mixed friday sign and after ending a earnings weekthanks to optimism around that Federal Reserve (Fed) may lower interest rates this year. An expectation for which the inflation data that will be known during the next sessions. «The direction of price developments in the US is of special importance to evaluate the Fed room to maneuver in their monetary policies», they explain in Renta 4. Therefore, the market will be very attentive to the April CPIwhich will be published this Wednesday, and for which a slight moderation is expected in the general rate until the 3.4% from 3.5% the previous month. For the underlying variable relaxation is expected until 3.6% from 3.8%. «It is estimated that price growth data should moderate to at least +0.2% in monthly rate to gradually approach the Fed's 2% objective, a rate that has not yet been reached. Currently, The market foresees two rate cuts in the current yearbut of course policy direction will be 'data-dependent'«add these experts. If it is confirmed that inflation has resumed bearish path«would increase expectations of rate cuts in the USbeing well received, therefore, by the equity and fixed income markets», they underline in Link Securities. Now, «if the readings exceed expectations by analysts, confirming what was seen in the first quarter of 2024, that inflation remains resistant, far from the Fed's 2% objective, both markets will turn lower«, these analysts highlight. Likewise, and in search of clues about the organization's next movements, investors will closely follow the statements of the members of the US central bank such as Loretta Mesterpresident of the Cleveland Federal Reserve, or Philip Jefferson, governor of the Federal Reserve. The economic agenda also includes production prices (Tuesday), another reference that will arouse the interest of investors to check if the disinflation process that the Fed craves to cut rates is underway. Furthermore, investors continue to pay attention to the tensions between the US and China on trade matters, and in this sense the Secretary of the Treasury, Janet Yellen has assured that she does not expect the Asian giant to retaliate significant in relation to any measure that the North American Government may adopt. «We hope that let's not see a significant Chinese response, but that is always a possibility,» Yellen stressed.


At the business level, the leading role will fall on the retail results as Home Depot either Walmart that will release their figures for the first quarter of the year. 92% of the S&P 500 companies have presented their results as of Friday, and 80% of them have exceeded Wall Street forecasts, according to FactSet data. Furthermore, the actions of GameStop they soar this Monday close to 45% before a social media post by the investor known as 'Roaring Kitty', one of the main drivers of the 'meme action' and the very strong increases that the company experienced in 2021. Also Chipmaker Arm rises (+3%), as it plans to launch artificial intelligence (AI) microprocessors in 2025 as the battle for dominance of semiconductors based on this new technology intensifies. In other markets, oil West Texas rises 0.61% ($78.74) and the Brent advances 0.47% ($83.18). For his part, the euro appreciates 0.30% ($1.0803), and the ounce of gold fell 0.90% ($2,353). Besides, the 10-year American bond yield relaxes at 4.469% and the bitcoin earn 2.20% ($62,786).