MarketBites: Slow Trading Ahead Of Big Earnings
Portfolio Manager Commentary:
Stocks didn't move much on Monday with trading volumes being the lowest during a full session in 2022. Investors are cautious as they gear up for a significant week ahead. Almost a third of S&P 500 companies are set to report this week including Apple, Alphabet, and Microsoft.
On Wednesday, economists expect the Federal Reserve to raise interest rates by 0.75% and update guidance on future rate hikes. On Thursday, Q2 GDP data will be released, which economists expect to be the second consecutive negative quarterly GDP report. This would mark the beginning of an unofficial recession in the United States (unofficial as it takes a while for economists to formally announce a recession, by which point the stock market usually starts rising in anticipation of the next bull market).
In Europe, gas prices soared after Russia decided to cut Europe's gas flow via the Nord Stream Pipeline to 20%.
Chart of the Day:
The inventory to sales ratio at some of the largest retailers including Walmart and Target reached 1.58 in May. Such a high inventory figure relative to sales hasn't been seen since September 2007.