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Day Ahead: Top 3 Things to Watch

Published 08/22/2018, 04:49 PM
© Reuters.  Alibaba earnings will be in focus.

Investing.com - Here’s a preview of the top 3 things that could rock markets tomorrow.

1. Jackson Hole Symposium Starts

Wall Street will be prepping for some talking heads to influence the market when the Federal Reserve’s annual symposium in Jackson Hole, Wyo. begins tomorrow.

While the big speech will be from Federal Reserve Chairman Jerome Power on Friday, there will be plenty of opportunities for the media to interview economic heavyweights. The title of this year’s symposium is “Changing Market Structure and Implications for Monetary Policy.”

Today, the Fed released the minutes of its last meeting, which indicated that the Federal Open Market Committee still sees solid growth and is ready to keep raising rates at a moderate pace.

"Fed staff continued to project that the economy would expand at an above-trend pace," the minutes showed. "Members expected that further gradual increases in the target range for the federal funds rate would be consistent with sustained expansion of economic activity, strong labor market conditions, and inflation near the Committee's symmetric 2 percent objective over the medium term."

Fed policymakers raised their outlook on U.S. economy growth, citing stronger household spending.

"Relative to the forecast prepared for the June meeting, the projection for real GDP growth was revised up a little, primarily in response to stronger incoming data on household spending," the minutes said.

2. New Home Sales Expected to Rise

The economic calendar is very busy tomorrow, with more housing data leading the way.

The Commerce Department will release numbers on new home sales for July at 10:00 AM ET (14:00 GMT). Economists expect that sales of new homes rose 2.2% last month.

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The housing market has been the one cause of concern in the otherwise strong economy. Existing home sales fell unexpectedly in July.

Initial jobless claims figures arrive at 8:30 AM ET (12:30 GMT) and the Markit composite and services PMIs are due at 9:45 AM ET (13:45 GMT).

3. Alibaba Numbers Will Give View Into China

Alibaba (NYSE:BABA) highlights the earnings before the bell tomorrow.

On average, analysts expect that the Chinese e-commerce company earned $1.19 per share in the latest quarter on sales of $11.8 billion.

Apart from the headline numbers, investors will be looking at the impact of the recent weakness in the Chinese economy and any effect tariffs imposed by the U.S. are having. There will also be focus on how Alibaba’s venture into brick-and-mortar stores is going.

Shares of Alibaba hit their 52-week high at the start of the year, but have been trending downward in the last three months.

Sears (NASDAQ:SHLD) will also issue numbers ahead of trading, while Gap (NYSE:GPS) and Ross Stores (NASDAQ:ROST) weigh in after the bell.

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