09/22 Weekly Issue Check: Powell Says, PCE Price Index, Micron Earnings, Immigration Policy Changes
- Powell and other Fed members’ comments
Fed Chairman Powell and Fed Vice Chairman Bowman are scheduled to speak on the economic outlook on the 23rd (Tuesday). After the recent September FOMC, Powell is unlikely to mention new things because he has already announced his key positions at a press conference. Nevertheless, at the September FOMC, Powell mentioned unstable factors such as concerns in the job market, K-shaped movements in consumption, and rising delinquency rates on high-risk corporate bonds, so he pays attention to the details of the remarks. Not only Powell but also Fed members such as President John Williams are making remarks every day. In particular, although he hinted at two additional rate cuts through SEP, the pace of rate cuts among the committee members is still tight, so if some committee members mention that there is no pace of rate cuts, it could put a strain on the stock market - PCE Price Index
According to NowCasting, the Cleveland Fed expects the PCE price index to rise 0.32% and 0.28%, respectively, in August from the previous month, and 2.79% and 2.99%, respectively. In general, it is expected to slightly exceed or be similar to last month’s announcement. The market is expected to be 0.3% month-on-month and 0.2% at the root. Compared to the previous year, it is 2.7% and 2.9% at the root. The reason why this announcement is important is that at the FOMC in September, Powell maintained caution, saying that further easing may be needed but the data should be supported. At that time, members who predicted two additional rate cuts and one cut were confronting each other, and there is a sense of caution that if the PCE price index is lower than expected, expectations for two cuts will increase, but in the opposite case, it could only be one cut. Therefore, there is a high possibility of increasing volatility in the stock market depending on the results. - Micron earnings
Micron will announce its earnings after the close of the U.S. stock market on Tuesday (Tuesday). Major investment firms are expected to provide strong earnings improvements and positive outlooks for Micron. Some expect the average unit price (ASP) of HBM4 to rise by more than 50 percent compared to HBM3e. Strong orders for Nvidia’s GB300 chips are also a major driver of Micron’s earnings. In addition, it is favorable to note that rising demand for AI is driving the overall price increase in the memory market. In fact, Mizuho and others argued that DRAM prices could rise an additional 20-30% from the current level. Given this, expectations are growing that future prospects will also exceed market expectations. However, it is important how risks such as intensifying competition and HBM inventory are mentioned in the conference call. - a Trump visa policy
On Friday, U.S. President Trump signed a decree to drastically increase the H1-B visa application fee from $1,000 to $100,000 a year. The policy calls for companies to prioritize hiring American workers and limiting visas to high-skilled professionals, starting with the recognition that H1-B visas deprive Americans of their jobs. The biggest hit by the move are large technology stocks such as Apple, Amazon, and Microsoft, which have been using H1-B visas on a large scale. In addition, it is virtually impossible for startups or small and medium-sized companies that lack funds to hire foreign workers. Concerns have been raised that it could weaken the innovation engine of U.S. companies in the long run. In particular, it is highly likely that the U.S. will deteriorate its long-term growth engine, considering that major talents have fled to France and China due to the Trump administration’s spending cuts at research institutes, stricter visa regulations, and policies to reduce the influx of international students. Related issues are not issues that have a significant impact on the stock market in the short term, but they need to be constantly noted that they are factors that will worsen U.S. growth.
*Issues to Watch by Day of the week
Monday (22nd): Trump’s Immigration Policy And Big Tech
Tuesday (23rd): Fed Chairman Powell Remarks On Economic Outlook
Wednesday (24th): Micron Earnings Before Day and Semiconductor Companies
Thursday (25th): Fed Members Remarks (6 people)
Friday (26th): PCE price index, consumer spending
*a weekly schedule
09/22 (Monday)
China: LPR Rate Decision
U.S.: Chicago Fed’s National Activity Index
Event: Korea Blockchain Week
Companies: Robinhood (HOOD), Approbin (APP), M-Core (EME) S&P 500 Index Joins
Remarks: Williams (Economic Outlook), Mussalem (Economic Outlook), Hamack, Barkin, Miran Director (Non-monetary Power and Appropriate Monetary Policy)
09/23 (Tuesday)
Korea: Producer Price Index
Germany: Manufacturing PMI, Service PMI
US: Manufacturing PMI, Service PMI
Remarks: Fed Chairman Powell (Economic Outlook), Vice Chairman Bowman (Economic Outlook), Governor Bostic
Bonds: U.S. 2-year Treasury bid
Closed: Japan
Earnings Load: AutoZone (AZO)
After Earnings: Micron (MU), AAR (AIR)
09/24 (Wednesday)
Korea: Consumer Confidence Index
Germany: IFO Business Environment Index
United States: New Housing Sales
Remarks: Governor Daly (Economic Outlook)
BOND: U.S. 5-YEAR Treasury Bids
Earnings Load: Cintas (CTAS), Uranium Energy (UEC)
After earnings: KB Home (KBH)
09/25 (Thursday)
Germany: New car registrations for August
US: Q2 GDP Growth
Bank: SNB (Switzerland) Monetary Policy Conference
Report: ECB Monthly Report
Bonds: U.S. 7-year Treasury bid
Remarks: Goolsbee, Williams, Logan, Daly, Goolsbee President, Vice Chairman Bowman (supervisor regulation), Vice Chairman Barr (stress test)
Earnings Loaded: Accenture ACN, Jabil JBL, Carmax KMX
After Earnings: Costco (COST)
09/26 (Friday)
Japan: Tokyo Consumer Price Index
China: Industrial Profits (27th)
US: Personal Income, Household Expenditure, PCE Price Index. Consumer Sentiment Index (HW)
Remarks: Deputy Chairman Bowman (approach to monetary policy decision-making) Governor Barkin