Stock Market Update

The stock market is on track for a modestly lower opening after an impressive Friday rally that largely neutralized losses from earlier in the week. 

Fed Chair Powell's dovish tone at the Jackson Hole Symposium prompted an increase in rate cut expectations Friday that saw stocks advance, with small-cap stocks performing particularly well.

Mega-cap tech names had several bumpy sessions last week that weighed down the major averages until Friday's rally. Mega-cap performance will be closely watched this week as NVIDIA (NVDA 177.80, -0.19, -0.1%) reports its earnings Wednesday after the close.

The market will also receive earnings reports from several larger retailers throughout the week. 

Today's economic data is limited to the 10:00 ET release of New Home Sales data. Friday brings about the Personal Income and Outlays report, which includes the PCE Price Index, one of the Fed's preferred inflation gauges. 

Headlines are relatively quiet elsewhere, though NBC News reports that Vice President JD Vance said in an interview that he is optimistic the U.S. can broker an end to the war between Russia and Ukraine.

In corporate news:

• Apple (AAPL 226.96, -0.80, -0.4%) launched a three-year plan to revamp the iPhone, according to Bloomberg.
• Intel (INTC 25.36, +0.56, +2.3%) confirmed that the U.S. government will take a 9.9% equity stake in the company, according to Reuters. 
• Meta Platforms (META 71.76, -3.30, -0.4%) agrees to a new partnership with the AI lab Midjourney Inc., according to Bloomberg.
• NVIDIA (NVDA 177.80, -0.19, -0.1%) is preparing a new and more powerful AI chip for sale in China, according to The New York Times. 
• Spotify (SPOT 697.00, +4.01, +0.6%) plans price increases amid the rollout of new services, according to The Financial Times. 

Reviewing overnight developments:

Equity indices in the Asia-Pacific region began the week on a higher note, with China's Shanghai Composite (+1.5%) reaching its best level since 2015 while Hong Kong's Hang Seng (+1.9%) hit its best level since late 2021. Japan's Nikkei: +0.4%, Hong Kong's Hang Seng: +1.9%, China's Shanghai Composite: +1.5%, India's Sensex: +0.4%, South Korea's Kospi: +1.3%, Australia's ASX All Ordinaries: +0.1%.

In news:

• Shanghai eased rules pertaining to home purchases in outer suburbs.
• The approval rating of Japan Prime Minister Ishiba's cabinet has improved to 40%.
• South Korea's President Lee will meet with President Trump at the White House today.
• Fitch affirmed India's BBB- rating with a Stable outlook.

In economic data:

• Japan's June Leading Index 0.8% m/m (expected 1.3%; last 0.6%) and Coincident Indicator 0.7% m/m (expected 0.8%; last 0.0%)
• Singapore's July CPI -0.4% m/m (last -0.1%); 0.6% yr/yr (expected 0.7%; last 0.8%). July Core CPI 0.5% yr/yr (last 0.6%)
• New Zealand's Q2 Retail Sales 0.5% qtr/qtr (expected 0.1%; last 0.8%); 0.7% yr/yr (expected -0.3%; last 0.4%)

Major European indices trade in the red while the U.K.'s FTSE is closed for a bank holiday. STOXX Europe 600: -0.2%, Germany's DAX: -0.2%, U.K.'s FTSE 100: HOLIDAY, France's CAC 40: -0.6%, Italy's FTSE MIB: +0.1%, Spain's IBEX 35: -0.6%.

In news:

• There was some speculation that expectations for a rate cut from the European Central Bank will begin building after a pause in September.
• Germany's ifo Business Climate Index for August (89.0; expected 88.7) beat expectations by a slight margin with economists reporting some hope for new order growth among manufacturers of capital goods.

In economic data:

• Germany's August ifo Business Climate Index 89.0 (expected 88.7; last 88.6). August Current Assessment 86.4 (expected 86.7; last 86.5) and Business Expectations 91.6 (expected 90.2; last 90.8)
• Swiss Q2 Employment 5.532 mln (last 5.512 mln)
• Spain's July PPI 0.3% yr/yr (last 0.8%)