Market braces for a busy week ahead: What to watch

Despite ongoing concerns about Middle East tensions and rising oil prices, the stock market closed last week in the green after a strong US jobs report. As inflation and rate cuts remain hot topics, investors are closely watching this week’s CPI report and Federal Reserve minutes to gauge the Fed’s next moves. 

The global digital assets market printed green indexes on Monday morning in anticipation of a big week ahead. The cumulative crypto market cap surged by a whopping 3% over the last day to stand at $2.22 trillion. Bitcoin (BTC) recorded a sharp surge in the last 24 hours helping it to regain the $63,000 mark.

Crucial CPI and Fed minutes loom

Investors are turning up to the big week’s key reports, including the September Consumer Price Index (CPI). It will reveal more about inflation trends for the market as minutes from the Fed’s recent meeting are also expected.

Markets are on edge as a series of major events could spark volatility. NVIDIA’s ($NVDA) AI Summit kicks off Monday which is followed by PepsiCo’s ($PEP) earnings on Tuesday. The Fed’s FOMC minutes will be dropped on Wednesday offering clues on interest rate policy. 

Fed Chair Powell kicked off the week with a clear message suggesting no rush for deep rate cuts. Speaking at the NABE Annual Meeting, he signaled that any cuts would be gradual, likely around 25bps, and that the Fed isn’t rushing. 

While another 50bp cut is off the table for now, the market is still pricing in 53bps of easing by the end of the year. November’s employment report could sway Fed decisions before their next rate announcement.  

Will it be an Uptober?

After delivering a heavy 50bp cut in September, the Fed’s minutes are expected to highlight the ongoing rate-cut consensus. Most officials have reportedly favored more cuts though a hawkish repricing is in the sight of a 25bp cut in November.

This week’s Thursday is packed with US CPI inflation data, Tesla’s ($TSLA) Robotaxi event, AMD’s ($AMD) AI showcase, and jobless claims figures.

Investors’ eyes are really on Thursday’s US CPI report. Investors expect Year-on-Year headline inflation to drop to 2.3% (from 2.5%) with core inflation steady at 3.2%. A cooler CPI would strengthen the Fed’s soft landing case.  However, Friday wraps up with JPMorgan Chase’s ($JPM) earnings, PPI inflation data, and US consumer sentiment reports.

The crypto market is all placed in for big rallies in Uptober as Bitcoin stands strong over the $63,000 mark after dealing with multiple corrections. BTC has managed to gain by over 17% in the last 30 days while it saw a marginal drop in the past 7 days. The biggest altcoin, Ethereum price also jumped by more than 3% in the last 24 hours hinting a positive phase ahead for other cryptos.