The S&P 500 and Nasdaq notched their best weekly performance since November.
The much awaited inflation report sent cheers across Wall Street as U.S. consumer prices in December fell 0.1% from the previous month- the first decline since May 2020. On an annual basis, CPI increased at a slower pace of 6.5% in December, compared to the 7.1% rise in November.
While fuel and motor vehicle prices fell, rents and utilities remained expensive. Supported by last week’s inflation reading, analysts now see a greater likelihood of the Fed raising interest rates by 25 basis points in February.
Top stories from last week
- Cognizant (CTSH) shares added over 9% last week as the company raised its fourth-quarter revenue guidance. The IT company also named the former Infosys president Ravi Kumar S as its CEO.
- Tesla (TSLA) slashed prices on its electric vehicles in the United States and Europe by as much as 20% after missing 2022 delivery estimates.
- Disney (DIS) announced Mark Parker, the executive chairman of Nike, as its new chairman. The company also opposed Nelson Peltz of Trian as he pushed for a seat on the board, igniting a proxy battle.
- JPMorgan Chase (JPM) and Bank of America (BAC) beat quarterly earnings estimates, while Wells Fargo (WFC) and Citigroup (C) fell short of quarterly profit estimates.
The week ahead
- The U.S. stock market will be closed on January 16, Monday for the Martin Luther King Jr. Day holiday.
- Earnings this week: Goldman Sachs (GS), Morgan Stanley (MS), Netflix (NFLX), Procter & Gamble (PG), Schlumberger (SLB) etc.
- Economic data this week: Empire State manufacturing index, Produce price index and Retail sales report, among others.
- The week also includes speeches from various Federal Reserve members ahead of the very important January 31-February 1 FOMC meeting.
Stock watchlist for this week
*Consensus rating and average price target as per Tipranks data.