Two steps forward, one step back, yet equities still up 1% for the week. Friday's March PCE important.

The video in this report is only accessible to members
The video in this report is only accessible to members
The video in this report is only accessible to members
The video in this report is only accessible to members

VIDEO: This has been a challenging week for markets, but the overall message to us is companies are delivering strong earnings and investors are still wary that inflation might be accelerating. We get a better answer with April CPI in a few weeks. 

Please click below to view our Macro Minute (duration: 4:45)

The video in this report is only accessible to members
The video in this report is only accessible to members

This may surprise many investors, but the S&P 500 is actually up +1% for the week. After weeks of downward pressure, and the selling seen on Wednesday and Thursday, the tape feels "heavier" than a +1% week. This coming Friday is the release of March Core PCE deflator (Fed's preferred measure of inflation) and the Street is looking for +0.29% MoM.

A lot of wariness and fear is likely baked into market expectations ahead of Friday's release of PCE (8:30am ET). Why do we suggest this?- Thursday's release of 1Q24 GDP saw a sharp rise in rates and a decline in equities– 1Q24 Core PCE Price Index YoY came in at +2.9%, higher than expected for March YoY +2.7%- But as we know, the key question is how much is due to Jan/Feb revisions Our Head of Data Science, "tireless Ken," expects core PCE deflator of +0.30%, just a touch above consensus. Is a "hot reading" going to tank marke...

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