Stocks rally on strong economic data & soft inflation | MarketTalk: What’s up today? | Swissquote

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US stocks shrugged off the early week pessimism on the back as of a set of strong economic data released yesterday.
We would’ve normally expected sentiment to be dampened by strong data because of more hawkish Federal Reserve (Fed) expectations, but the S&P500 jumped more than 1%, Nasdaq rallied almost 2%, while the Russell 2000 advanced around 1.5%.
Easing inflation is maybe why stock investors are happy with strong data.
The Australian inflation fell to a 13-month low, and the Canadian inflation fell more than expected, in a sign that the central bank efforts to pull prices lower is paying off.
Across the Atlantic Ocean, some encouraging news came in regarding inflation, as well. The British shop prices dipped to 8.4% this month, down from 9% recorded in May, thanks to government asking Tesco, Sainsbury’s, Asda and Morrisons to ‘behave’ in their pricing to prevent them from passing the higher costs, and higher wages on to their clients more than necessary.
The Fed will reveal its stress test results today, and if no issue, expect the Fed hawks return to Wall Street.
The Bank for International Settlements, known as the central bank of the central banks, warned that the final stretch of the monetary tightening will likely be the toughest, with some ‘surprises’ on the way. Another banking crisis, real estate chaos, a financial crisis? We will see. Today, the Fed will reveal the result of its stress test for the banks. If they see no issue, they will keep pushing, until something breaks.
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