CPI Preview: Good, Bad, & Ugly
CPI Preview: Good, Bad, & Ugly: Start a free trial of The Sevens Report.
What’s in Today’s Report:
- Thoughts on the Meme-Stock Revival
- CPI Preview: Good, Bad, & Ugly
- Chart – NY Fed’s Consumer Survey Contains Hot Inflation Print
Global markets are little changed this morning as traders digest mostly better-than-expected economic data from Europe and await today’s PPI report and commentary from Fed Chair Powell.
“Meme stocks” GME and AMC are notably up 58% and 64%, respectively, in pre-market trading this morning (more on that in today’s report).
Economically, German CPI met estimates at 2.2% y/y while Economic Sentiment in the German ZEW came in at 47.1 vs. (E) 45.0. Domestically, the NFIB Small Business Optimism Index beat with a headline of 89.7 vs. (E) 88.3 but the data is having a limited impact on markets this morning.
Looking into today’s session, focus will be on PPI (E: 0.3% m/m, 2.2% y/y) and Core PPI (E: 0.2% m/m, 2.3% y/y) due out at 8:30 a.m. ET. A “hot” print would spark hawkish, risk-off money flows while a cooler-than-expected report could see the S&P 500 test all-time-highs as CPI whisper numbers are dialed back.
Finally, there are a handful of Fed speakers today including Cook (9:10 a.m. ET) ahead of the bell and Schmid (8:15 p.m. ET) later this evening. Most importantly though, Powell will speak at 10:00 a.m. ET and if he is more hawkish than two weeks ago at the May FOMC meeting, that will put upward pressure on rates and weigh, potentially heavily, on stocks.
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