Earnings, economic data expected out next week

Yahoo Finance's Akiko Fujita discusses what to expect next week in markets.

Video transcript


AKIKO FUJITA: As we wrap up the shortened holiday week, it's time to look ahead to what is expected to be a very busy week next week. Let's start on Wednesday, though. That's one that a lot of investors are going to be watching here when Fed Chair Jay Powell speaks at Brookings Institution. Certainly a lot of investors looking for any indication or maybe a little more information coming from Jay Powell on what the pace of those rate hikes look like.

We've also got [INAUDIBLE] earnings on tap, and then, of course, to round out the week, Rachelle, we're going to be looking at that all important jobs numbers. Certainly have been a big part of the Fed's guide here in terms of how quickly they raise those rates. We have seen the unemployment number tick up just a bit, and it's one of those things where we've been watching those jobs numbers saying, well, good news hasn't necessarily been good news for the market. So it's going to be interesting to see where those numbers come in and how the investors respond.

RACHELLE AKUFFO: And as we know, with every data point that comes out, we see this sort of market exuberance, and then Powell will usually come out and throw a bit of cold water on it and be like calm down. I've not said I'm taking my foot off the gas any time soon. So it'll be interesting to see how each piece of data, what that does for market sentiment at the moment because they do seem to believe that we're heading in for this Santa Claus rally based on what we've been seeing over the last few weeks.

But I don't know how much that exuberance is going to last. And as you mentioned, jobs data, obviously, something else that the Fed watches closely as we sort of pass through and sort of take a look at how those jobs are coming out, the types of jobs that are coming back, and if that's going to be enough. Just how much data the Fed is going to need before it's satisfied, perhaps, doing 50 and then 25 and then another 25 basis points at its subsequent meetings. But still early days, but something definitely to keep an eye on, Akiko.

AKIKO FUJITA: Yeah, no question about that. And we have seen sort of this back and forth with the markets. On the one hand, when we got the inflation print coming through sort of softer than expected, the expectations seemed to shift that there might be some kind of pivot coming from the Fed. And then we've heard from several Fed officials to say, look, it's not just about one data point. That's something they reiterated over and over.

Yes, it's a good sign that there are starting to be signs of some kind of cool down in inflation. But it's certainly not going to be the only thing they're going to be looking at. So resetting market expectations, if it was about a reset, not quite sure how we characterize it. But it's certainly going to be something that we'll be watching there as we look to Fed Chair Jay Powell speaking later this week. And, hey, we're ending on a positive note, right, at least this week in the markets.

RACHELLE AKUFFO: True. That's true, and I mean, also when it comes to earnings as well sort of-- as I think about more than 90% of the S&P has reported earnings already, but keeping an eye on some of the earnings, granted, I think the expectations were quite low. The bar was quite low, and it has been a bit of a mixed earnings season. But keeping an eye on a lot of the forward guidance that we'll be keeping an eye on things like inventories and things like outlooks, if companies are willing to give that forward guidance, will sort of really test to see how people feel about the market going forward, Akiko.