What happened last week:
The three major indices notched back-to-back weekly gains and finished the week as follows: DJIA: 0.65%, S&P 500: 1.31%, NASDAQ: 2.37%. Each index is currently positive for the month of November and all three remain in the green year-to-date: DJIA: 3.43%, S&P 500: 15.00%, NASDAQ: 31.83%.
At a conference hosted by the International Monetary Fund, Federal Reserve Chairman Jerome Powell acknowledged that the Federal Open Market Committee (FOMC) is “not confident” current policy tightening is restrictive enough to bring inflation down to 2% over time. Powell continued, “If it becomes appropriate to tighten policy further, we will not hesitate to do so. We will continue to move carefully, however, allowing us to address both the risk of being misled by a few good months of data, and the risk of overtightening.” San Francisco Federal Reserve President Mary Daly commented later in the week that inflation data has been “fairly good” but said, “It is far too early to declare victory.” Daly added, “We’re in a position now where we know we’re significantly restrictive. But to really be truly confident that we have a sufficient level of restriction in the economy to bring inflation down, we’re going to have to watch the data and see if the economy is slowing.” The next FOMC decision on interest rates will be made on December 13.
The Cleveland Federal Reserve is looking for its next President as current leader Loretta Mester is set to retire in mid-2024 as she reaches the age of mandatory retirement. She has held her title for 10 years and has been considered one of the more hawkish members of the central bank.
In the News:
The Food and Drug Administration approved Eli Lily’s (LLY) blockbuster drug for weight loss. The drug’s active ingredient, tirzepatide, was previously approved for the treatment of Type 2 diabetes last May and is expected to be available in the U.S. by the end of this year with a month’s supply priced at $1,060. According to Goldman Sachs, the global market for anti-obesity medications is forecasted to reach $100 billion by 2030. Earlier this year the market reached $6 billion on an annualized basis.
PepsiCo (PEP) CFO Hugh Johnston will leave his position after 34 years with the company and join Disney (DIS) in the same role. Johnston was named CFO at PepsiCo in 2010.
What to look for this week:
On Tuesday, the inflation rate year-over-year for October is expected to decrease to 3.3% from 3.7%, which would be the first declining reading since June. The rate peaked last year at 9.1% in June. Meanwhile, the coreinflation rate year-over-year for October is expected to remain at 4.1%, which was the lowest reading since September 2021 (4.0%).
Thanks for reading!
- The Rockline Team
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