Stocks finished the week at record highs as investors digested the Federal Reserve's interest rate cut and weighed the path ahead for policy.
In the week ahead, a raft of Fedspeak will highlight the calendar, with speeches from newly installed Federal Reserve board governor Stephen Miran and Fed Chair Jay Powell on Monday and Tuesday, respectively, the biggest events for close Fed-watchers.
Elsewhere on the calendar, a few major earnings reports and a smattering of economic data will populate the schedule as investors navigate the relative lull between earnings seasons.
A key economic highlight will be Friday's update on inflation, with the Personal Consumption Expenditures index set to show that “core” PCE inflation, the Fed's preferred measure, eased to 0.2% in August while annual increases remained at 2.9%, above the central bank's target.
Investors will also keep an eye on the University of Michigan's consumer sentiment index out Friday morning and also closely track mortgage rates, which are near their lowest levels in a year, according to Freddie Mac.
Attention on earnings this week will be focused on Micron Technology (MU), where investors will watch for updates on AI-driven demand and revenue guidance after a recent raise, and on Costco (COST), a stalwart measure of consumer spending patterns.
Firefly Aerospace (FLY), AutoZone (AZO), Cintas Corporation (CTAS), and Accenture (ACN) are also among the notable names expected to report results.
Investors were all but certain the Fed was going to cut rates last week.
They celebrated the move anyway.
On Thursday, the S&P 500, Nasdaq, Dow, and Russell 2,000 closed at record highs in unison for the first time since 2021. On Friday, the three major indexes — excluding the small-cap Russell 2000 (^RUT) — closed at another record.
With investors enthusiastic about not only the Fed's rate cut this week, but also the path ahead for the central bank, stocks saw their largest weekly inflow since December, according to data from Bank of America.
Read more: How the Fed rate decision affects your bank accounts, loans, credit cards, and investments
Inflows to US stocks this week tallied $57.7 billion, while investors moved nearly $5 billion out of cash for the first weekly outflow since July, BofA said. Some investors and commentators may talk about fears of the stock market growing overheated; actions suggest otherwise.
And not only have investors gotten the rate cuts some clamored for, but trade risks have also subsided.
Tariffs on China remain on a 90-day pause until Nov. 10 as Trump continues to ease tensions with his counterpart in Beijing. Signals that an agreement on control of TikTok's US operations looks set to be reached and suggestions that Presidents Trump and Xi will meet later this year in South Korea all eased worries about the US-China trade spat.
