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U.S. CPI and earnings ahead, 'Barbie' tops $1 bn - what's moving markets

Published 07/08/2023, 07:56 pm
Updated 07/08/2023, 07:56 pm
© Reuters.

Investing.com -- U.S. stock futures rise, hinting at a rebound from weekly declines on Wall Street, as investors gear up for key inflation data later in the week as well as the final leg of the latest quarterly earnings season. Meanwhile, "Barbie" surpasses $1 billion in global ticket sales.

1. Futures higher as inflation data looms

U.S. stock futures pointed higher Monday as investors looked ahead to the release of key monthly inflation figures later in the week and prepared for more corporate earnings.

By 05:05 ET (09:05 GMT), the Dow futures contract gained 74 points or 0.21%, S&P 500 futures added 15 points or 0.33%, and Nasdaq 100 futures rose by 69 points or 0.45%.

The main indices on Wall Street fell to end the previous trading week, with the benchmark S&P 500 and tech-heavy Nasdaq Composite slipping to their fourth-consecutive day of declines -- the longest losing streak since May. Data showing weaker-than-anticipated jobs growth in July, as well as disappointing hardware sales from tech behemoth Apple (NASDAQ:AAPL), both factored into market sentiment.

Highlighting the economic agenda this week is the U.S. consumer price index for July, which could give traders further insight into the potential policy path ahead for the Federal Reserve. Meanwhile, Walt Disney (NYSE:DIS) is set to publish its third-quarter results on Wednesday (see below).

2. Headline inflation seen accelerating

Economists predict that inflation in the U.S. grew at a faster pace for the first time since June 2022 last month, possibly complicating the emerging narrative of easing price growth in the world's largest economy.

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The consumer price index (CPI) for July is expected to accelerate to 3.3% annually, up from 3.0% in the prior month. Month-on-month, the reading is seen holding steady at 0.2%.

Thursday's CPI print will also include the so-called "core" figure stripping out volatile items like food and energy. The reading is projected to slow to 4.7% year-on-year and stay unchanged at 0.2% on a monthly basis.

Federal Reserve officials, who previously said that their upcoming policy decisions would be "data-dependent," will likely be paying close attention to the numbers.

Corralling inflation back down to the Fed's 2% target has been the major focus of the central bank's more than year-long campaign of interest rate hikes, and data since last summer suggest that the tightening has helped to tamp down prices. Yet, policymakers have signaled that they remain willing to roll out further rate increases should inflation show signs that it is climbing once again.

3. Earnings season marches on

Investment management giant KKR (NYSE:KKR), software group Palantir (NYSE:PLTR), and entertainment firm Paramount Global (NASDAQ:PARAA) will make up some of the biggest companies unveiling their latest quarterly results on Monday.

The returns will kick off the final stretch of the second-quarter earnings season. According to FactSet data cited by CNBC, more than 84% of the businesses in the S&P 500 have already reported, with about four-fifths of these numbers topping Wall Street expectations.

Walt Disney may likely be one of the major headliners later in the week.

Investors will be keen to hear more about chief executive Bob Iger's plans to reignite performance at the media conglomerate's movie studios after a series of recent box office disappointments like "Elemental" and "Haunted Mansion." Iger may also face questions around ESPN after reports surfaced that he brought on two former lieutenants to help explore strategic options for Disney's vaunted sports network.

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4. 'Barbie' soars above $1B

It's a "Barbie" world, indeed.

"Barbie" has raked in more than $1B in ticket sales worldwide just 17 days after its debut, according to a unit of distributor Warner Bros. Discovery (NASDAQ:WBD).

In a statement, the studio said Greta Gerwig's pink-splashed fantasy comedy took home $459.4 million in North America and $572.1M overseas. The figures were later confirmed by media analytics group Comscore.

It also makes Gerwig the first-ever woman to solo-direct a billion-dollar picture.

Warner Bros. executives Jeff Goldstein and Andrew Cripps said they were "rendered speechless" by the success of the film, which stars Margot Robbie and Ryan Gosling as the titular doll and her frustrated counterpart Ken. Goldstein and Cripps noted that the returns have "blown even our most optimistic predictions out of the water."

"Barbie," which was aided by a massive marketing campaign and an Internet phenomenon that paired it with Christopher Nolan's biopic "Oppenheimer," is now the sixth movie to surpass the billion-dollar box office mark since the pandemic.

5. Crude hovers around four-month high

Oil prices edged lower Monday but remained near their highest levels since mid-April after top producers Saudi Arabia and Russia announced plans late last week to extend output reductions for another month to tighten global markets further.

Along with the production cuts from Riyadh and Moscow, traders will be eyeing Chinese economic data this week to gauge how much government stimulus may be needed to boost a waning post-pandemic recovery in the world's biggest crude importer.

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By 05:06 ET, the U.S. crude futures contract traded 0.66% lower at $82.27 a barrel, while the Brent contract dropped 0.57% to $85.75.

Both contracts recorded their sixth consecutive weekly gains last week, the longest winning streak since December 2021 to January 2022.

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