✅ Written by Austin DeNoce, Markets Reporter, Walk-On Holdings

✅ Edited by Casimir Stone, Creative Director Walk-On Holdings

For the Second Week In July, the Markets Will Be Watching…

…the unofficial kick-off to the second quarter earnings season. On Friday, report cards are due from most of the biggest banks in the U.S. 

Ironically, earnings will start the week very slowly, with no major reports scheduled through Wednesday. However, the floodgates will open in the back half of the week.

Thursday will bring earnings from several consumer goods giants — PepsiCo (PEP) and Slim Jim-owner Conagra Brands (CAG) — as well as other household names like insurance provider Progressive Corporation (PGR) and Delta Air Lines (DAL). 

But the marquee event will come Friday, when JPMorgan Chase (JPM), Wells Fargo (WFC), Citigroup (C), and BNY Mellon (BK) all report. These earnings calls typically fall on the same day each quarter, considered by many economists to be the proverbial starting pistol for each earnings season. Given the exposure these big banks have to a vast array of industries, their success — or lack thereof — can effectively set the tone for the whole quarter.

Last quarter, JPMorgan and Wells Fargo took a slight hit following their earnings calls after forecasting lackluster interest income despite the high rate environment. On the call, JPMorgan CEO Jamie Dimon took a cautious tone while projecting future performance for the bank and broader economy, saying, “Many economic indicators continue to be favorable. However, looking ahead, we remain alert to a number of significant uncertain forces.” 

This week, market observers will be listening carefully to see if the banks’ caution was warranted or, as a Piper Sandler analyst characterized it at the time, “ultra-conservative.” Whatever the case, Friday’s once-in-a-quarter event will provide crucial clues to the future financial performance of the banks, their fellow corporate giants, and the economy at large.

Also on the economic calendar…

Monday, July 8

The week will start with a temperature check, as the Federal Reserve’s consumer inflation expectations measure the average American’s perception of the economic landscape.

Tuesday, July 9

Small business owners will also weigh in on sentiment with the NFIB Small Business Optimism Index. Additionally, several Fed members will speak throughout the day, and U.S. Treasury Secretary Janet Yellen will add her own voice in the evening via Congressional testimony.

Wednesday, July 10

A Fed Speak-heavy week will peak with a speech from Fed Chair Jerome Powell ahead of several key inflation prints the following day. The 30-year mortgage rate update and wholesale inventories will also come in.

Thursday, July 11

The Consumer Price Index (CPI) for June will be released. As always, this measure of price inflation is sure to factor heavily into the central bank’s coming interest rate decision at the end of the month. Jobless claims are also due.

Friday, July 12

The Producer Price Index (PPI), a measure of wholesale inflation, will add context to the CPI — and, since rises in the prices paid by producers tend to ripple into retail sticker prices sooner or later, it may provide a sneak peek into future inflation reports as well.