The Week Ahead on Wall Street

Economic Data

Today, the Federal budget for August is released. This tracks spending on the part of the Federal government each month. In July the government reported a $302 billion deficit, which was a record for the month. Continued COVID-19 relief spending was the main cause of the shortfall.

On Tuesday, the Commerce Department releases the consumer price index (CPI) for August. In July the CPI jumped 5.4% year-over-year, driven by pent-up demand for goods and services. For August, investors will be paying close attention to see if demand is slowing as the Delta variant of COVID-19 continues to spread. Also Tuesday, the Core CPI and the NFIB small business index for August is released.

On Wednesday, be on the lookout for the import price index for August. This tracks the average changes in the prices of goods and services imported and exported in a given month. In July, US import prices saw 0.3% growth, marking the smallest gain since November. August is expected to show more of the same.

On Thursday, initial and existing unemployment claims for the week prior are released. Unemployment has steadily declined even as COVID-19 cases continue to rise. Investors will be paying close attention to make sure the trend continues. Also Thursday, retail sales for August are released. If the decline is more than the 1.1% expected, it will raise concerns for investors about the Delta variant’s impact on the retail industry.

On Friday, the University of Michigan releases its preliminary Consumer Sentiment Index numbers for September. This metric tracks how consumers are feeling about their finances and the economy. In August the index came in at 70.3 which was a lot lower than the 81.2 reading in July.

Earnings Reports

Today, Oracle (ORCL), the software giant, reports quarterly earnings. Last week, Tensesee agreed to pay Oracle $65 million in tax incentives to move its headquarters to the state. Earlier this year Oracle vowed to spend $1.2 billion on its new headquarters in Tennessee.

On Tuesday, be on the lookout for earnings from FuelCell Energy (FCEL), a company which designs, manufacturers, and manages fuel cell power plants. Early this month Hyundai Motor announced its intention to develop hydrogen fuel cell-powered commercial vehicles by 2028. That follows an announcement from BMW, which in June said it was testing cars with hydrogen fuel cell drivetrains. It will be interesting to hear what FuelCell Energy has to say about the recent developments in the market when it reports earnings.

On Wednesday, Jinko Solar (JKS) reports quarterly earnings. The solar module manufacturer, which distributes panels in China, the US, Japan, the UK, and a host of other countries, recently inked a multi-year polysilicon supply agreement with Wacker Chemie. The deal helps Jinko Solar address polysilicon supply shortages, which have driven up the price of solar panels. Investors will be looking for any signs supply shortages are abating when it reports quarterly earnings.

On Friday, be on the lookout for insurer Progressive (PGR) to report quarterly earnings. The personal auto insurer has been facing loss ratio pressures as the number and size of claims rise. That may prompt Progressive to cut back on the amount it spends on advertising, with larger decreases coming in states where it can’t raise premiums. Investors will want to hear more about how it will respond to loss ratio pressures in the coming months when it reports earnings.

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