The Week Ahead: Brexit Votes, Inflation, Aging Bull Market
Quite a lot happened in the markets in the past week. And a lot more will be happening in the week ahead.
Headlining the coming week will be Tuesday’s critical UK Parliamentary vote on British Prime Minister Theresa May’s Brexit deal. If this doesn’t pass (again), there could very well be a delay of the March 29 Brexit Day deadline, which would likely move markets significantly.
Also featured during the week will be key U.S. inflation readings, including the consumer price index and producer price index. These help inform Federal Reserve monetary policy and can also have a market impact.
And, of course, this past Saturday marked the 10-year anniversary of the aging bull market in stocks. It’s been the longest bull market in history, and the big question now is whether it’ll last.
Let’s begin with a review of the past week:
The Week in Review
- The U.S. economy created only 20,000 new jobs in February, a fraction of the 180,000 jobs that were expected by economists. While wage growth and the unemployment rate were better than expected, the dismal headline jobs data prompted a knee-jerk, negative reaction from investors.
- The euro plunged to a new 20-month low against the U.S. dollar. This happened after the European Central Bank cut its 2019 economic growth forecast drastically from 1.7% back in December to a new estimate of only 1.1% GDP growth.
- China’s exports plummeted by more than 20% in February, further exacerbating fears surrounding the country’s economic slowdown. Chinese officials blamed the drop in part on temporary interruptions from Chinese New Year’s celebrations. But the data’s market impact was clearly felt from Shanghai to New York.
- The S&P 500 (SPX) pulled back hard from major 2816-area resistance, shedding around 2.60% for the week. The week-long market pullback was the worst one since the beginning of the year, interrupting the sharp rally from late December.
- The S&P 500 dipped back below its 200-day moving average, sparking concerns about the health of the market recovery.
- Saturday (3/09/2019) marked the 10-year anniversary of the U.S. stock bull market. From the post-crisis low of 676.53 on March 9, 2009 to the 2743.07 close on March 8, 2019, the S&P 500 (SPX) has risen over 300% in this 10-year period.
And now, here’s what’s upcoming:
The Week Ahead
- Monday, 8:30 AM ET – February U.S. Retail Sales (0.0% expected) and Core Retail Sales (+0.4% expected)
- Tuesday – UK Parliament votes on British Prime Minister Theresa May’s Brexit deal with the European Union. If this is voted down, which is currently expected, either the UK will leave the EU without a deal (“hard Brexit”) on Brexit Day (March 29), or the departure date will be delayed.
- Tuesday, 8:30 AM ET – February U.S. Consumer Price Index (+0.2% expected) and Core CPI (+0.2% expected)
- Wednesday, 8:30 AM ET – February U.S. Producer Price Index (+0.2% expected) and Core PPI (+0.2% expected)
- Wednesday, Before Market Open – Progressive (PGR) company earnings
- Thursday, Before Market Open – Dollar General (DG) company earnings
- Thursday, After Market Close – Adobe (ADBE) company earnings, Oracle (ORCL) company earnings
Check out our Market Events & Earnings Calendar for more!
IMPORTANT: The information above should not be construed as investment advice and should not be considered as a solicitation to buy or sell securities. Trading and investing in the financial markets involves substantial risk of loss, and may not be suitable for all investors.
Disclosure: At the time of this article’s publication, we have no position in any security or trade/investment mentioned, nor do we have any business relationship with any company whose stock may be mentioned.
Chief Market Strategist at The Technicals
With more than two decades of experience as an equity analyst for several major research firms, Don has covered individual stocks (both technically and fundamentally) across a wide variety of sectors and industries, including tech, financial, and retail. He has been quoted regularly in key financial media like Bloomberg and Reuters. Contact Don