Monday Morning Meeting Notes (01/30/2023)

General Info:

• The December personal consumption expenditure (PCE) index rose by 0.1% month-over-month (vs. expectations of 0.0%), while the year-over-year number was 5.0%
• Core PCE, which excludes volatile food and energy prices, is the Fed’s preferred inflation gauge
• Core PCE rose 0.3% month-over-month and 4.4% year-over-year (both matching expectations)
• With the fed funds rate at a range of 4.25%-4.50%, this means the upper bound of the fed funds rate is now back above Core PCE for the first time since the Federal Reserve starting hiking rates
• Q4 2022 GDP for the U.S. grew by 2.9% annualized, which beat expectations of 2.6%
• Fun Fact: Punxsutawney Phil is just a nickname. Pennsylvania’s most famous groundhog is “Punxsutawney Phil, Seer of Seers, Sage of Sages, Prognosticator of Prognosticators, and Weather Prophet Extraordinary”

Monday 01/30:

• NVR, NXP Semiconductors, and SoFi Technologies report earnings
• Eurozone economic confidence and consumer confidence data
• The International Monetary Fund (IMF) publishes its world economic outlook update
• Mainland Chinese markets reopen after Lunar New Year

Tuesday 01/31:

• Exxon Mobil, Caterpillar, McDonald’s, Dover, Canadian Pacific Railway, Pfizer, UPS, Stryker, General Motors, Amgen, Advanced Micro Devices, Moody’s Corp, Mondelez International, Corning, Evoqua Water Technologies, Marathon Petroleum, and UniCredit report earnings
• U.S. Conference Board consumer confidence data for January
• Eurozone GDP data for Q4 2022 is expected to have declined -0.1% quarter-over-quarter and risen 1.7% year-over-year
• China industrial profits, manufacturing PMI, and non-manufacturing PMI

Wednesday 02/01:

• Meta Platforms, Markel, McKesson, and T-Mobile report earnings
• Federal Reserve (Fed) monetary policy meeting, followed by Fed Chair Powell’s press conference
• The Fed is expected to slow the pace of its rate hike by raising rates 0.25%, which would bring the fed funds rate to a range of 4.50-4.75%
• S&P Global Manufacturing PMI data for the U.S., Eurozone, U.K., Germany, France, and India
• ISM Manufacturing PMI data for the U.S.
• China Caixin Manufacturing PMI data for January
• U.S. light vehicle sales for January
• Eurozone consumer price index (CPI) data for January

Thursday 02/02:

• Groundhog Day in the U.S.
• Apple, Alphabet, Amazon, Shell PLC, Qualcomm, Deutsche Bank, Bristol-Myers Squibb, Eli Lilly, Becton Dickinson, Ford, Starbucks, Ball Corp, U.S. Steel, Hershey, Harley Davidson, Merck, Estee Lauder, Clorox Co, Gilead Sciences, Illinois Tool Works, Honeywell International, and Littelfuse report earnings
• Bank of England (BOE) monetary policy decision
• The BOE is expected to hike rates by 0.50%, bringing its bank rate to 4.00%
• European Central Bank (ECB) monetary policy decision
• The ECB is expected to hike rates by 0.50%, bringing its main refinancing rate to 3.00%

Friday 02/03:

• Aon PLC, Cigna Corp, Zimmer Biomet Holdings, CBOE, Church & Dwight, and Regeneron Pharmaceuticals report earnings
• U.S. employment report for January, which is expected to show 185,000 new jobs added
• The unemployment rate is expected to increase from 3.5% to 3.6%, the labor force participation rate is expected to remain steady at 62.3%, and average hourly earnings are expected to increase 0.3% month-over month and 4.3% year-over-year
• S&P Global Services PMI data for the U.S., Eurozone, U.K., Germany, France, and India
• China Caixin Services PMI data for January