What step will the Fed take? What will the week bring?

Last week, we witnessed a better reading of the American GDP, a virtually official announcement of the end of the interest rate increase cycle in the euro zone, and good results of most companies on Wall Street. Despite this, the main US stock indices recorded a significant decline.

Will the Federal Reserve be able to change market sentiment?

The quarterly dynamics of US GDP surprised with an increase of 4,9%. These data contradict the concerns expressed by investors so far about the approaching recession in the United States. However, other data coming from the USA show a mixed picture - the economic situation there is neither bad nor good. However, the incredible power of the American consumer deserves attention. So why are Wall Street's major stock indexes performing so poorly?

It's earnings season in the United States - the reports of most Big Tech companies are behind us. It is the reports from Microsoft, Amazon and Google that give investors reasons to worry. Despite the fact that in terms of revenues - and especially at the EPS level - all of them performed very well, the results from the cloud computing segment may be worrying.

Hence, the key event of this week remains the monetary decision Fed. Although expectations regarding Wednesday's meeting are rather consistent - the Federal Reserve will probably not raise rates either on November 1, or probably at all in this cycle. Due to the ongoing conflict in the Middle East and the related situation on the oil market, there is little chance for some movement, but in recent weeks the statements of FOMC representatives have softened significantly. But will Jerome Powell allow the market to play to future rate cuts?

In today's webinar:

• Is this the end of interest rate increases in the US?
• How to evaluate the ongoing earnings season?
• What is the situation on the broader market?

About the host

Dr Przemysław Kwiecień - Chief economist X-Trade Brokers. Doctor of Economics at the University of Warsaw, graduate of the University of Warsaw and London Metropolitan University (MSc). Holder of the prestigious CFA certificate. He has been working for XTB since 2007, previously he gained experience as an advisor to the Minister of Finance, Mirosław Gronicki, and an economist at Bank Millennium. At XTB, he manages the Analysis Department.

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