Market Rebound on the Horizon? What to Watch in a Pivotal Week

After last week's selloff sent the Nasdaq into a correction and raised fears about a potential recession, stocks are poised for a rebound in a quieter week on the economic data front. However, investors should brace for continued volatility as they weigh recession risks against increasingly robust corporate earnings. The growing likelihood of a September rate cut by the Federal Reserve also looms large over markets.

Monday
• S&P Global Services/Composite PMIs for July
• ISM Services Index for July
• Earnings: Avis, Lucid, Palantir, Tyson

Tuesday
• June Trade Balance data
• Earnings: Airbnb, Caterpillar, Rivian, Uber, Wynn Resorts

Wednesday
• Consumer Credit data for June
• Earnings: CVS, Disney, Lyft, Robinhood, Shopify

Thursday
• Weekly jobless claims
• Earnings: Datadog, Eli Lilly, Paramount, Plug Power

Friday
• No major economic releases
• Earnings: Canopy Growth, Nikola

What It Means for Investors:
While this week is lighter on economic data, there are still several key events and reports for investors to watch:

• The growing consensus that the Fed will cut rates in September, with debate centered on whether it will be a 25 or 50 basis point cut based on recent weak data.
• Upcoming comments from Fed officials could provide clues on the size of the September move.
• Earnings from companies like Disney (streaming/sports rights), Airbnb, and Eli Lilly will help gauge corporate health.
• The strong 11.5% year-over-year S&P 500 earnings growth signals companies are navigating the slowdown better than expected so far.

Overall, the light economic calendar allows earnings to take center stage this week in driving market movements. But investors should brace for continued volatility amid lingering recession concerns ahead of the pivotal Fed decision next month.

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