1. Business Results from Technology Stocks
Growth in FAANG top stocks has a huge impact on the S&P 500. Which has driven the market higher in the past decade. The FAANG shares will report their earnings during the week as follows:
- Facebook (NASDAQ:FB) will report on Monday.
- Alphabet, Google’s parent company (NASDAQ:GOOGL), will report Tuesday.
- Apple and Amazon will report on Thursday.
Investors are still weighing rising commodity prices on the one hand against rising bond yields and inflation on the other.
2. U.S. GDP
Thursday’s data is expected to show factors affecting the U.S. economy in the third quarter.
The impact of the Delta strain of Covid-19, combined with higher price supply chains and labor shortages, has slowed growth. However, these effects are expected to be overcome in the fourth quarter.
Other economic data to watch this week:
- Durable goods order report on Wednesday.
- First unemployment benefits on Thursday.
- Personal income and expenses on Friday.
- Friday’s data will include the core PCE price index, the Federal Reserve’s favorite inflation measure.
The economic data will be closely watched, as this will happen before the Federal Reserve meeting in November next week. The meeting could provide information announcing plans to taper asset purchases (QE) and interest rate policy.
3. ECB Meeting
At the last meeting in September, it was decided to postpone the decision on the bond-buying program until December. But since then, inflation in the euro area has reached a 13-year high amid supply shortages and rising energy prices.
The Fed is likely to begin its decline in November, and the Bank of England has indicated it will raise interest rates soon.
Reporting of the post-Thursday policy meeting with the ECB is likely to give investors clues to its December decision.
4. Evergrande Delayed Paying Debts
China’s Evergrande resumes more than 10 projects in six cities, including Shenzhen. After the company avoided defaulting on debt last week.
The Evergrande crisis has spread to China’s entire real estate sector, which economists estimate accounts for about 30% of the economy, leading to defaults, a credit downgrade, and a decline in corporate bonds.
5. Bitcoin Volatility
Bitcoin reaches its all-time high of $67,016, surpassing the record set in April. The all-time high this time was driven by the new Bitcoin future ETF, which encouraged investors to pump fresh capital into the digital currency.
Bitcoin supporters believe the launch of the ETF will support the price, while some investors praised that cryptocurrencies can protect against inflation because Bitcoin outperformed inflation.
No matter what factor the price runs. The volatility of Bitcoin seems to continue.