Equities continued to move higher following Friday’s positive jobs report. Financials and industrials are both nearing all-time highs. iShares U.S. Home Construction (ITB) hit another new 52-week high last week and opened at a new high on Monday.
Inflation data for June will be released this week. Consumer prices are expected to reflect a 0.1-percent rise, while producer price estimates are flat. Core CPI and retail sales ex-autos are both anticipating a 0.2-percent rise in June. Industrial production, capacity utilization and consumer sentiment are all expected to rise. Wholesale and business inventories will also be out this week, and both numbers will heavily influence second-quarter GDP estimates. The Atlanta Fed most recently forecast 2.7 percent growth on July 6.
West Texas Intermediate crude started the week at $44 a barrel. A large drawdown lifted prices marginally, but gasoline demand remains muted and U.S. production is rising.
Pepsi (PEP) will release earnings on Tuesday. Analysts expect $1.40 per-share, up from $1.35 a year ago. Delta Air Lines (DAL) will report on Thursday to forecasts of $1.64 per-share, up from $1.47 a year ago. U.S. Global Jets ETF (JETS) hit a new all-time high on Friday and investors anticipate a strong earnings season for the airline sector.
J.P. Morgan (JPM), Wells Fargo (WFC), Citigroup (C) and regional bank PNC Financial Services (PNC) will report earnings on Friday. These four banks combine for $860 billion in market capitalization. JPM, WFC and C account for 25 percent of SPDR Financial (XLF). The consensus forecasts call for $1.55 per-share at J.P. Morgan, $1.03 for Wells Fargo, $1.23 at Citigroup and $2.01 at PNC.