Powell's speech, DNC, retail earnings: What to watch this week

Morning Brief Hosts Seana Smith and Brad Smith break down the big week ahead on Wall Street.

The number one thing to watch this week is Federal Reserve Chair Jerome Powell's speech on Friday at the Jackson Hole Symposium. Investors will pay close attention to his remarks, which will provide a clearer picture of what an interest rate cut could look like at the Fed's September meeting.

Secondly, the consumer will be back in focus this week as Wall Street braces for a slew of retail earnings. Companies expected to report their quarterly results include Lowe's (LOW), Target (TGT), Macy's (M), TJX (TJX), Urban Outfitters (URBN), and BJ's Wholesale (BJ).

Finally, the Democratic National Convention is kicking off in Chicago today. Investors will be looking for more details from Vice President Kamala Harris's economic agenda and what she plans to accomplish over the next four years if she is elected in November.

For more expert insight and the latest market action, click here to watch this full episode of Morning Brief.

This post was written by Melanie Riehl

Video Transcript

It's Monday, August 19th.

Let's get to your investor checklist for the trading week here.

The number one thing to watch this week we've got fed chair Powell's speech out of Jackson Hole.

That's coming Friday morning.

Now, investors, they're gonna be paying close attention to Powell's words and his tone will hints of a rate cut spark a rally here.

And of course, at previous Jackson Hole symposiums, I mean, we've come a long way from just the eight minute address of two years ago and now much more focus on what the depth and pathway for the rate cuts coming forward could look like.

Yes, I think, I think a big question here for the markets and you talked about whether or not it's going to trigger a rally.

A lot of that is that a lot of that is going to be based on exactly what we hear from Paul and maybe the willingness of not only 25 basis points at the next meeting in September, whether or not he even leaves 50 basis points on the table.

And as we start the show this morning, just around, just over 70% of traders.

Now, pricing in the odds of a 25 basis point cut in September, that's compared to less than 30% that are a 50 basis point cut in September.

But again, any sort of signaling in terms of some of that Dovish commentary could likely drive some of that market momentum here to the upside.

We also want to take a close look at here.

Keep on our radar, a slew of retail earnings that we're going to get here this week.

It's going to offer another glimpse at the strength of the US consumer, whether or not actually we're seeing some weakness.

We want to keep a close eye on target specifically for signs of weakness and discretionary spending.

That has certainly been a trend for their earnings here over the last several quarters.

And they're far from the only retailer that's reporting this week.

We're also gonna hear from TGX.

We also got Lowe's a number of the names up here on your screen.

We've got Macy's coming out on Wednesday.

So again, just giving us a better insight here to the consumer and exactly some of the trends that we are seeing because yes, Walmart did look strong when you take a look at those headline numbers.

But underneath the hood though, there was certainly reason to believe that there is a cautious, a cautious consumer right now who is pulling back on spending.

Yeah, and our conversation with John Raining last week, the CFO over at Walmart he definitely talked about what they're seeing in the signs of the consumer, not necessarily weak but not the most strong right now.

And so I think that's where they're gonna continue to lean into the trade in verbiage that we've heard Walmart talk about.

It's interesting for all of these household known names.

The largest retailer that's actually reporting this week is Lowe's.

So we'll get that one tomorrow here.

I didn't even know that by market cap, Lowe's is almost double the size of.

So we'll be in a close eye on that one.

But of course, Target and the bulls eye gonna be in focus.

Macy's about 5 $6 billion market cap company there.

That's gonna be in focus as well.

Plus some of the discount retailers as they call them in TJ X and Ross.

Also, finally, the Democratic National Convention kicking off in Chicago, Chi Town today, President Joe Biden gonna headline tonight and the big thing for investors to watch this week, details of vice President harris' economic agenda.

One of the major things that we've seen already be released is the economic plan looking at some of the cuts for households where there could be CRE credits uh coming forward for uh additional child and then additionally, for some of those new time home buyers, we were discussing that last week on wealth as well.

Yeah, I think investors in Wall Street really looking for a little bit more in terms of the details of what we got from the outline here of uh Vice President Harris economic agenda, maybe more specifically what it would look like under a Harris administration.

And then I think we're going to see more comparisons, right?

Lots of questions or lots of fear surrounding some of the rhetoric, some of the commentary that we've heard from former president Donald Trump, what tariffs, what his plans there, what exactly that could ultimately do for the feds fight to tame inflation and how that will potentially complicate some of those efforts.

So I think more comparisons there and exactly what this means for the economy going forward is certainly going to be a focus here this week.