Investing.com - Here’s a preview of the top 3 things that could rock markets tomorrow.
1. Apple Is Next in the Tech Earnings Parade
Tech stocks were in control of the market’s bearish action Monday and that weak sentiment could persist into Tuesday’s open with no major names reporting before the bell.
Wall Street will get results of consumer products giant Procter & Gamble (NYSE:PG) and drugmaker Pfizer (NYSE:PFE), among others.
But tech investors may want to keep their powder dry until Apple (NASDAQ:AAPL), the last of the FAANG stocks still to report, issues earnings after the bell.
Apple’s profit per share is expected to rise about 30% from the year-ago period, with sales remaining about the same. The key to quarterly performance will likely be the company’s ability to boost services sales in the face of a slump in iPhone sales.
Apple shares were the most resilient of the FAANGs on Monday, falling less than 1%.
2. Bank of Japan Meeting Could Move Markets (Really)
There are a host of central bank meetings this week and the Bank of Japan could significantly impact the currency markets when it wraps up its meeting Tuesday. The focus will be on whether the BOJ tweaks its massive asset-buying campaign.
"(T)here is increasing speculation the BOJ may tweak its yield curve control settings in part because of lower bank profitability and muted inflation in Japan," Elias Haddad, senior currency strategist at Commonwealth Bank of Australia, wrote in a note.
The BOJ could also modify its annual objective of accumulating 80 trillion yen ($720 billion) of Japanese government bonds, as well as potentially lifting its target yield for Japan 10-Year JGBs.
But it wouldn’t be a surprise “to see the central bank stand pat for now, especially with policymakers likely having to revise down their inflation and GDP forecasts to account for the recent soft patch in economic data,” Matthew Weller of Faraday Research wrote.
3. Fed Gets Its Favorite Inflation Numbers
The Federal Open Market Committee starts its two-day interest rate policy meeting Tuesday. The market expects the Fed to keep rates unchanged, but will be looking for any hints about the pace of future hikes.
The Fed will have more data to work with tomorrow when its preferred inflation gauge -- the personal consumption expenditures prices excluding food and energy (core PCE) -- for June arrives.
On average, economists expect that core PCE index rose 2% year-on-year, the same as in May, and was up 0.1% month-on-month, compared with a 0.2% rise in May.
Personal income and spending are both expected to post a 0.4% rise for June.