Wall Street week ahead: All eyes on Federal Reserve’s interest rate decision

On Wall Street in the week ahead, market participants’ focus will be on the US Federal Reserve’s two day monetary policy meeting starting September 17.

The US central bank is widely expected to slash interest rates for the first time since 2020.

Following the Fed monetary policy committee’s decision on interest rates, Chair Jerome Powell will hold the press conference to elaborate on policy outcome.

The Fed has kept its main interest rate at a two-decade high in hopes of slowing the economy enough to stifle high inflation.

Next week, the Wall Street will also see updates on some crucial economic data such as US retail sales, home sales, and industrial production among others.

Economic events

On September 16 (Monday), a report on Empire State manufacturing survey for September will be released.

On September 17 (Tuesday), data on US retail sales for August, industrial production for August, and home builder confidence index for September will be declared.

On September 18 (Wednesday), the Federal Open Market Committee (FOMC) will declare its decision on interest rates, Fed Chair Jerome Powell will hold a press conference, and a report on housing starts for August will be released.

On September 19 (Thursday), data on Philadelphia Fed manufacturing survey for September and existing home sales for August will be released.

Earnings

Following companies are due to report second quarter earnings in the week ahead — Ferguson Enterprises, General Mills, Steelcase, FedEx, Lennar, Darden Restaurants, and FactSet Research.

US markets last week

US stock indices closed higher on Friday on hopes of a bigger interest rate cut by the Federal Reserve next week.

The Dow Jones Industrial Average rose 297.01 points, or 0.72 per cent, to 41,393.78, the S&P 500 gained 30.26 points, or 0.54 per cent, to 5,626.02 and the Nasdaq Composite gained 114.30 points, or 0.65 per cent, to 17,683.98.

For the week, the S&P 500 rose 4.02 per cent and the Nasdaq climbed 5.95 per cent, and the Dow added 2.60 per cent.

The yield on the 10-year Treasury eased to 3.65 per cent from 3.68 per cent. The 2-year yield fell more sharply to 3.58 per cent from 3.65 per cent.