2 major market themes that could make or break stocks after this week’s rally

By News Room Last updated Mar 23, 2024

Wall Street largely stumbled on Friday but still managed to post strong weekly gains. A powerful four-session winning streak that brought the Dow Industrials and the S & P 500 to all-time highs on Thursday was helped along by this week’s favorable update from the Federal Reserve. The Nasdaq , which was slightly higher on Friday, closed higher every day this week and finished at another record. Looking back on the week, the already rallying market breathed a sigh of relief Wednesday and got a further boost after the Fed signaled that three interest rate cuts will still prove appropriate by the end of the year. That answered a big question going into the central bank’s two-day March meeting following two months of hotter inflation readings. Fed policymakers kept rates unchanged, as expected. On Tuesday, housing starts for February came in better than expected. We hope to see that strength continue in the coming months as increasing supply would help keep housing inflation down. Shelter costs are a large and unavoidable line item for American consumers, and they have an outsized impact on the overall direction of key inflation indicators. Looking ahead, we get a key macroeconomic update and hear from several companies that can provide further insight into the real U.S. economy, particularly how small- and medium-sized businesses are doing. Economic data Friday is the big day. That’s when the government releases February personal income and spending data. Contained in this report is the Fed’s favorite inflation gauge: the personal consumption expenditures (PCE) price index. The consensus estimate, according to FactSet, is for a year-over-year increase of 2.5% in headline PCE and a 2.8% increase in core PCE, which excludes food and energy prices. On Thursday, the government is out its final reading on fourth-quarter 2023 gross domestic product (GDP). While backward-looking, it provides insight into how the economy held up into the end of last year. It also speaks to whether the fed funds rate is at an appropriate level and whether the central bank is right to hold rates higher for longer. The latest reading on pending home sales is also out Thursday, following Monday’s report on February new home sales and Tuesday’s release of S & P/Case-Shiller home price data. Durable goods orders for February are also out Tuesday. Quarterly earnings No Club names issue earnings next week, however, there are a few quarterly reports on Wednesday. Cruise operator Carnival ‘s numbers will provide a look at discretionary consumer spending through the travel lens. Quarterly results from Cintas , a provider of business services, will give us a snapshot of the health of small- and medium-sized businesses. Following the company’s last quarterly report, Jim Cramer said, “You cannot have a recession if Cintas is blowing the doors open.” Earnings from Paychex , one of the nation’s largest payroll processors, will provide insight into the state of the labor market. Since the U.S. is a consumption-driven economy, low unemployment means more buying power, which is key to the Fed being able to fight inflation — while at the same time, hopefully, avoiding a recession. Monday, March 25 10 a.m. ET: New home sales Tuesday, March 26 8 a.m. ET: Durable goods orders 10 a.m. ET: S & P/Case-Shiller home prices Before the bell: McCormick & Company (MKC) After the bell: GameStop (GME) Wednesday, March 27 Before the bell: Carnival (CCL), Cintas, Paychex (PAYX) After the bell: Jefferies Financial (JEF), HB Fuller (FUL) Thursday, March 28 8:30 a.m. ET: Jobless claims 8:30 a.m. ET: Gross domestic product 10 a.m. ET: Pending Home Sales Before the bell: Walgreens Boots Alliance (WBA) Friday, March 29 8:30 a.m. ET: PCE price index (See here for a full list of the stocks in Jim Cramer’s Charitable Trust.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust’s portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED.

Visitors around the Charging Bull statue near the New York Stock Exchange on June 29, 2023.

Victor J. Blue | Bloomberg | Getty Images

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