Equity markets tried to move higher on Wednesday following the CPI report. While the headline figure fell a tenth compared to last year and came in below consensus, the rest of the data set overshadows the decline. Headline inflation accelerated compared to last month, and the core figures were as expected and unchanged from last month. This leaves inflation running at more than double the Fed's target and does not allow them to ease back on interest rates. The takeaway for the market is that interest rates may not rise anymore, but they are not going down anytime soon.

The news helped lift tech stocks dependent on debt to fuel growth. The rally lifted the NASDAQ Composite by more than 1% to the highest levels in 6 months and has the index on track to extend the gains. The next target for the tech-heavy index is near 13,000 and it will be a tough line to cross. The S&P 500 is still below critical resistance at 4,150.

Equity markets pulled back for a second day on Tuesday as markets eye Wednesday's CPI report. The report is expected to show consumer prices are still rising at an above-target pace, and there is little hope for cooling. The core PPI reading is expected to accelerate on a month-to-month basis and may lead to a hot YOY reading. Even if the reading cools, with inflation still rising, the Fed can not be expected to ease back on the interest rate throttle.

The S&P 500 is at a critical juncture; the next few days could decide the market's direction over the next 3 months. If the index can get its feet under it and move above 4,150, it could extend the rally to 4,300 or higher. Aside from inflation and the FOMC, the risk is that the outlook for 2nd half earnings growth resumed its slide. The consensus figures are now at the lowest level on record and are weighing heavily on stock market prices.

Equity markets traded in a tight range on Monday, starting the week on an uncertain note. The action was dominated by concern this week's CPI report would confirm the need to keep interest rates higher for longer, if not on the rise. That concern was shaded by the latest Fed Senior Loan Officer Opinion Survey, which shows credit conditions are tightening for businesses and consumers nationwide. The news is evidence that loan officers are growing nervous about the economy's future.

The S&P 500 is at a critical juncture, trading at the 4,150 level. This level marks the bottom of a trading range that has dominated the market for the last 12 months; the next move will be a telling one. If the market can rise above 4,150, lifted by a brightening earnings outlook, it could continue to rise into the summer months. If not, this market will remain range bound with a chance of moving down to retest support at lower levels.

Equity markets ended a turbulent week on solid footing, rising more than 2.0% on Friday. The move was supported by a robust NFP report that shows job and wage gains with unemployment lingering at low levels. The news suggests core economic strength that will help the Fed achieve its soft-landing but other data disagrees. The number of layoffs is rising while job availability declines and consumer products manufacturers brace for a downturn in spending.

Next week will be about inflation with reports on CPI, PPI and import prices. The CPI data is expected to come in flat compared to the previous month, which is hot and contrary to the idea of the Fed pausing. The risk for the market is that inflation will persist at these levels into the summer and force another interest rate hike. In that scenario, more banks will fail, and consumer spending will slow further.

Equity markets fell for a 3rd day as fear of a broader spread financial system crisis grows. While the First Republic Bank chapter of the saga has come to a close, the FOMC is expected to keep rates at high levels for a sustained time and will likely cause more banks to fail. The question is how many and how soon, and the answer may not be known until regulators close the next bank down.

The S&P 500 shed more than 1.0% at the session's low and is testing support at the 4,050 level. Support at this level may be tenuous and lead to another market sell-off. If so, the following targets for support are several percentage points lower. Even if the market can sustain these levels, there is clear resistance at the 4,150 level that is keeping the market from moving higher.

Equity markets tried to move higher after the FOMC meeting, but the takeaways for investors are not bullish. The FOMC raised rates by 25 basis points as expected but left the door open to another hike later this year. The Fed also indicated it thought inflation would remain higher for longer and needed to leave interest rates higher to combat it. The market responded by pushing its expectation for the 1st interest rate cut to September and selling stocks.

The S&P 500 continues to show resistance at the 4,150 level and is unlikely to move above it. This will keep the index range bound in 2023, and there is a chance it will move lower. The increase in interest rates puts more pressure on an already cracking banking system and is sure to cause another failure, and the odds of recession continue to rise.

Equity markets retreated on Tuesday as fear of the Fed gripped the market. The S&P 500 fell more than 1.25% at the session's low and continues to show resistance at the 4,150 level. The odds the FOMC will hike by another 25 basis points is high; the risk for the market is in the policy statement. The FOMC may back off from further interest rate hikes, given the state of inflation and the risk to the banking sector, but it will not roll over and go to sleep. Inflation remains high; the FOMC needs to be sure the market understands it is ready to hike rates again should the data warrant it.

The NFP report will be another market-moving event later this week. The report is expected to show a slowdown in hiring and an uptick in unemployment which was foreshadowed by the JOLTs report on Tuesday. The JOLTs report shows that the number of open job positions has fallen to the lowest level in 2 years as employers cut back on expansion plans. This is the first real sign of economic slowing the market has taken to heart, and it is 1 that could result in recession.

Equity markets tried to advance on Monday following news that First Republic Bank assets had been seized by regulators and sold off to the highest bidder. That bidder turned out to be JPMorgan Chase & Co, which was primarily responsible for the initial bailout. However, the market could not catch a bid due to lingering uncertainty about the financial sector. JPM CEO Jamie Dimon said this part of the crisis is over; in his words, only so many banks were offside, like First Republic. Now that its depositors are cared for, market participants can move on to the next crisis.

This week will be another test for the market. The earnings deluge will continue with reports from big tech, consumer favorites like Starbucks and staples like Kraft Heinz. The takeaway to date is that earnings are better than expected, but most companies continue to deliver weak guidance. The news of the week will come on Wednesday when the FOMC hikes rates by another 25 basis points and adds incremental pressure to the economy.

Equities markets stumbled and bounced from support last week as earnings season rolls on. The week's news is that earnings are better than expected, and core consumer inflation cooled a tenth compared to the previous month. The sad news is that PCE prices fell 0.1% compared to an upwardly revised figure and are hotter than expected. In this light, the FOMC may be unable to ease back on interest rate hikes, although they have indicated the next meeting would be the last hike for 2023.

This week brings another round of earnings reports and key economic data. Topping the list of economic releases is the NFP report on Friday, followed by the ISM reports and construction spending. These data points are expected to confirm the slowing in the economy seen in other data points. Among the most troubling is the Index of Leading Indicators, which has been negative for more than a year and is trending deeper into negative territory.

Equity markets rebounded by 2% on Thursday, hoping the PCE price index would confirm a slowdown in inflation. The index is expected to hold steady at 0.3% compared to last month but fall to 4.5% compared to last year. That is a 0.1% decline in inflation but not enough reason for the market to rally. The market hopes that inflation will fall more than expected and lead the FOMC to begin pausing its interest rate hikes next week.

The risk for the Fed and the market is that pausing will allow the economy to regain traction and sustain inflation. In that scenario, the Fed will have to hike rates again later this year, possibly at a market-surprising pace. With oil prices hovering at levels not sustained in over a decade, it is unlikely inflation will turn negative, and there is a risk that oil prices will rise again. Oil prices are tied to the economic outlook; if the Fed surprises with a pause next week, the outlook will brighten, and oil prices will rise.