Good Morning,
I hope everyone had a great weekend. The wildfire smoke seems to have diminished considerably so hopefully that trend continues!
Markets are poised to open marginally higher this morning following a week of encouraging inflation data. Consumer prices rose less than expected in June, although the recent increase in hostilities with Iran will likely influence July's report. The Fed's next interest rate decision is scheduled for next week, and while no change is anticipated, I will be interested to hear how and how much, Chair Warsh discusses the outlook going forward.
Earnings season picks up momentum this week, with GE, Alphabet, IBM, and Tesla all reporting on Wednesday. While still early, results have generally been solid. Analyst expectations remain elevated, with significant attention focused on AI, future capital spending, and the sustainability of recent bottom-line improvements.
Beyond corporate fundamentals, the elephant in the room remains the conflict with Iran and any progress toward a resolution. Unless we see a significant move in oil prices, I expect stocks to remain relatively range-bound in the near term.
All things considered, I remain constructive on equities, particularly with a value tilt, and continue to look for solid earnings growth to help drive the market's next leg higher.
As always, please don't hesitate to reach out with any questions or comments.
Attached is this week's Market Strategy Radar Screen Report from John Stoltzfus, Chief Investment Strategist at Oppenheimer Asset Management.
Have a great week!