The Federal Reserve’s meeting this week likely won’t result in a change in interest rates, but it is likely to show where the central bank is heading, as investors will digest projections data, along with comments from Chair Jerome Powell. Market watchers also will be tuned in to the Consumer Price Index (CPI) report for indications on whether price pressures continue to ease.
Apple (AAPL) will hold its annual developers conference, where it is expected to unveil new products that utilize AI technology. And Tesla (TSLA) shareholders on Thursday will vote to approve a near $56 billion pay package for CEO Elon Musk. Meanwhile, several companies with a focus on artificial intelligence (AI), including Oracle (ORCL), Broadcom (AVGO), and Adobe (ADBE), are also reporting earnings. Also, Tesla (TSLA) shareholders will determine the fate of Elon Musk’s $56 billion pay package at their annual meeting Thursday.
Investors Watching Fed Meeting, May CPI Inflation Data
While the Bank of Canada and the European Central Bank made rate cuts last week, the U.S. Federal Reserve isn’t expected to follow suit when it meets this week. On Wednesday, the central bank will announce its interest rate decision, and it is expected to keep rates at the current 5.25%- 5.5% level. However, market watchers should get plenty of information this week on when the Fed could move forward with rate cuts of its own. The Federal Reserve’s monetary policy committee also will release its Summary of Economic Projections. This forecast includes the closely watched “dot plot,” which shows Federal Open Market Committee (FOMC) member projections on the path of interest rates.
Wednesday will be a busy day for economic data, with the May release of the Consumer Price Index (CPI) coming in the morning before the Federal Reserve’s interest rate announcement. Market watchers will be studying the latest print of the CPI inflation report after the April data showed a drop in inflation to 3.4%. That report gave investors and consumers hope that prices may be starting to cool after a run-up earlier this year. Fed officials have said they need to see more data showing cooling prices before moving to cut interest rates.
On Thursday, the Producer Price Index (PPI) will show the path of inflation for wholesalers, which is sometimes viewed as a precursor to consumer price pressures. Investors will also get data on consumer sentiment on Friday, offering more insight on spending trends and inflation expectations.
Apple’s Big Conference, Tesla’s Shareholder Vote
Two leading tech companies will be in the spotlight this week, with Apple set to unveil several new AI-powered features, and Tesla set to hold its annual shareholder meeting. Apple is likely to highlight new AI capabilities at its annual Worldwide Developers Conference, a five-day event kicking off on Monday where the tech giant unveils new features and products. This year, Apple is expected to debut a new operating system, as well as new generative AI features across a host of products like iMessage and Safari. Apple may also address recent reports of partnerships with rival Microsoft (MSFT)-backed ChatGPT maker OpenAI, and Alphabet’s (GOOGL) Google.
On Thursday, shareholders at Tesla’s annual meeting will vote on several items, notably a $55.8 billion pay package for CEO Elon Musk, which comes after a Delaware judge ruled that package was excessive. During the voting period, shareholders will also be asked to vote on whether the company should reincorporate in Texas, and also to re-elect two board members.
AI Firms Lead Limited Earnings Calendar
Oracle delivers results on Tuesday, as the database software and cloud computing firm looks to improve on last quarter’s earnings, when it beat expectations on higher profits from increased customer demand for its AI products. Semiconductor designer Broadcom is another company looking to show its AI business is growing, with analysts projecting a quarterly revenue jump when it reports earnings on Wednesday. Another company highlighting its AI offerings is Adobe, which reports on Thursday. The company delivered an 11% jump in revenue in its previous quarterly report, while also scaling back its projections for the current quarter.