S&P 500 Snaps 3-Week Losing Streak As Investors Digest Powell's Latest Inflation Comments

Zinger Key Points
  • Oracle and Adobe are among the companies reporting earnings in the week ahead.
  • Wall Street analysts lowered their third-quarter S&P 500 earnings estimates by an average of 5.4% in July and August, according to FactSet.

The SPDR S&P 500 ETF Trust SPY broke a three-week losing streak this week as the latest commentary from Federal Reserve Chair Jerome Powell suggests the Fed will continue to aggressively combat inflation.

On Thursday, Powell said the Fed remains "strongly committed" to fighting inflation, and reassured Americans the central bank will continue to raise interest rates "until the job is done." The bond market is pricing in an 86% chance the Fed will issue its third consecutive 0.75% interest rate hike later this month.

Apple, Inc. AAPL unveiled its new iPhone 14 models and other device updates on Wednesday as part of its annual product launch event. In addition to the hardware upgrades, Apple announced a new free Emergency SOS via Satellite feature provided by Globalstar, Inc. GSAT that can connect iPhones to emergency services even if the user is out of cellular or WiFi range.

Related Link: Apple Launches iPhone 14, High-End Apple Watch, Emergency Satellite Capabilities And More: What Investors Need To Know

On Wednesday, a judge denied Tesla Inc TSLA CEO Elon Musk's request to delay his trial against Twitter Inc TWTR which is suing to force Musk to follow through with his $44-billion buyout offer for the social media platform. Musk has attempted to back out of the acquisition, arguing that Twitter breached the terms of the buyout agreement by failing to provide accurate information about the percentage of its monetizable users that are actually spam accounts.

On Friday, popular stock trading app Robinhood Markets Inc HOOD launched the Robinhood Investor Index, which reflects only the most high-conviction stock holdings of its user base. Robinhood users gained a reputation for aggressive and at times reckless speculation during the meme stock trading frenzy that sent shares of AMC Entertainment Holdings Inc AMC and GameStop Corp. GME soaring in 2021.

Related Link: Robinhood Launches Index Of Highest-Conviction Stocks: Here Are The Top 10 Holdings

On Cloud Nine: Shares of cloud security software vendor Zscaler Inc ZS traded higher by 21% on Friday after the company exceeded analyst expectations with its fiscal fourth-quarter billings growth and fiscal 2023 guidance.

In the week ahead, investors will get more quarterly earnings reports from Oracle Corporation ORCL and Matrix Service Co MTRX on Monday, Core & Main Inc CNM on Tuesday and Adobe Inc ADBE on Thursday.

Wall Street analysts lowered their third-quarter S&P 500 earnings estimates by an average of 5.4% in July and August, according to FactSet.

Economic Numbers: In the week ahead, investors will get key economic updates on Tuesday when the U.S. Labor Department reports its August Consumer Price Index inflation reading and on Thursday when the Census Bureau releases its August U.S. Retail Sales report.

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