Fed's Favorite Inflation Data Friday Could Sway November Interest Rate Cut Odds
Portfolio Pulse from Piero Cingari
The upcoming release of the Personal Consumption Expenditure (PCE) price index report could significantly influence the Federal Reserve's decision on interest rate cuts in November. Market expectations currently suggest a 60% chance of a 50-basis-point cut, but this could change based on the PCE data. Previous PCE reports have positively impacted the stock market, with ETFs like SPY, QQQ, and DIA seeing gains.
September 25, 2024 | 4:03 pm
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POSITIVE IMPACT
The SPDR Dow Jones Industrial Average ETF (DIA) could benefit from a positive PCE report, as seen in previous instances where easing inflation boosted investor confidence.
DIA has previously gained when PCE reports indicated easing inflation, suggesting a potential positive impact if the upcoming report aligns with this trend.
CONFIDENCE 80
IMPORTANCE 60
RELEVANCE 70
POSITIVE IMPACT
The Invesco QQQ Trust (QQQ) may experience gains if the PCE report suggests lower inflation, as tech stocks have outperformed in similar past scenarios.
Tech stocks, represented by QQQ, have historically outperformed when PCE reports indicate easing inflation. A similar outcome is expected if the trend continues.
CONFIDENCE 85
IMPORTANCE 65
RELEVANCE 75
POSITIVE IMPACT
The SPDR S&P 500 ETF Trust (SPY) could see a positive impact if the upcoming PCE report indicates easing inflation, similar to previous reports.
Previous PCE reports showing easing inflation led to a rally in SPY. If the upcoming report follows this trend, SPY is likely to benefit.
CONFIDENCE 90
IMPORTANCE 70
RELEVANCE 80