CPI Inflation drives US Markets this week?
Last Week’s Performance.
Last week (June 02 - 06), US stocks were influenced by a strong jobs report, that helped markets close on a high note.
Major indices like the S&P 500 and Nasdaq saw pressure earlier in the week, but positive labour data and easing trade tensions led to a rebound, with stocks edging toward record levels by Fri, 06 Jun 2025. (see below)
The major composite index’s performance for the week:
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DJIA was up +1.33% (+562.93 to 42,762.87).
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S&P 500 was up +1.76 (+103.68 to 6,000.36).
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Nasdaq was up +2.45% (+466.89 to 19,529.95).
A New Wind Is Blowing !
For this week (June 9 - 13), US market attention now turns to US inflation data.
Economists and traders are closely watching for the upcoming Consumer Price Index (CPI) release on Wed, 11 Jun 2025, that will be critical for assessing the inflation outlook and potential Fed’s policy moves.
CPI reports timely release will be fodder for the Fed’s one last read of US inflation before they convene for FOMC meeting from June 17-18.
May 2025 CPI Recap.
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Monthly CPI has risen in April 2025. Will it be the same fate for May 2025 ?
The Forecast.
Below is average consensus of economists’ CPI estimates for May 2025:
The monthly pace is forecast to accelerate.
June’s headline inflation nowcast:
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Monthly estimation is 0.24%.
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Annual estimation is 2.67%.
June core inflation nowcast:
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Monthly estimation is 0.24%.
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Annual estimation is 3.01%.
If the Federal Reserves Bank of Cleveland’s estimates proves to be spot-on, I think there is no need to second guess how US market will react.
Also, on the run up to inflation reports released (be it CPI or PCE), market tends to be jittery as well.
Other Catalysts At Play.
Below are some possible catalysts that may or may not influence US market performance.
US Economic Reports.
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Wed, 11 Jun 2025 - Consumer Price Index (CPI) for May 2025. **most definitely.
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Thu, 12 Jun 2025 - US weekly jobless claims.
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Thu, 12 Jun 2025 - Producer Price Index (PPI) for May 2025. *definitely.
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Fri, 13 Jun 2025 - US Consumer Sentiments (prelim) for June 2025.
Quarterly Earnings Reporting.
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Mon, 09 Jun 2025 - $VinFast Auto(VFS)$
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Tue, 10 Jun 2025 - $GameStop(GME)$
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Tue, 10 Jun 2025 - $GitLab, Inc.(GTLB)$
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Wed, 11 Jun 2025 - $Oracle(ORCL)$
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Wed, 11 Jun 2025 - Sailpoint (SAIL). Will its earnings put its peers $VEEV, $MSFT in shame?
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Thu, 12 Jun 2025 - $Adobe(ADBE)$
US-China London’s Trade Talk.
This will be the “strongest” catalyst that will impact US market this week, before inflation data is released.
It is slated to start on Mon, 09 Jun 2025 and possibly stretched into Tue, 10 Jun 2025.
Discussion agenda.
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Tariffs and import duties. Negotiation cont’d to focus on reduce or restructure tariffs imposed by both sides, that have been complicated by a recent US trade court ruling some tariffs illegal, though they remain in place pending appeal.
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Rare Earth Elements (REE). This will be a major agenda item. Resumption and regulation of China’s exports of REE and magnets that is vital for US industries eg. Automotive, Aerospace, Semiconductors, and Military manufacturing.
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Export Controls and Technology Restrictions. To address US export controls and restrictions on advanced technology and components, that have become flashpoints with both sides accusing each other of “weaponizing trade”.
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Chinese students’ US visa.
Top places of origin for international students for 2023-24 school year
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Although not exactly a trade dispute, the impact of US Secretary of State Marco Rubio’s 28 May 2025 statement that US would “aggressively revoke visas for Chinese students, including those with connections to the Chinese Communist Party or studying in critical fields” might be lumped together as part of negotiation.
Will something good come from this 2-day meeting, just like backed in Geneva. Or will talk stalls and cause US market to pull back, before disappointing inflation numbers push US market down even further?
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Do you think US jobs market reports delivered a strong set of numbers in May 2025?
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Do you think US market will continue to really on the 2nd week of June 2025’?
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