It is hard to find anything to beat the excitement of the Fed’s interest-rate decision. However, the core PCE Price index could come a close second. The Fed believes that it has slayed the inflation dragon, which is why it cut interest rates by a whopping 0.5%. The market will find out if it is correct when the Fed’s preferred inflation gauge is released on Friday.
The market will also be keen to see if the Reserve Bank of Australia will follow suit. The central bank remains concerned that inflation is still above its 2% to 3% target range. So, it could keep its cash rate unchanged at 4.35%.
Staying with inflation, Malaysia is expected to say that the inflation rate in August has remained at a one-year high of 2%. Last month, prices continued to rise for food, alcoholic beverages and tobacco, and housing.
Meanwhile, Singapore is expected to say that the headline rate of inflation has dipped to 2.2%. But the core inflation is expected to remain unchanged at 2.5%.
On the corporate front
H&M Hennes & Mauritz (NYSE: HMRZF) has had a tough time protecting its margins as poor weather and cheap imports from China’s Shein and Temu heaped pressure on sales. In June, H&M said it was doubtful if it could hit its full-year operating margin target of 10%. unless it achieved stronger sales growth in the third and fourth quarter.
Global consulting company, Accenture (NYSE: ACN), has been an unexpected beneficiary of Artificial Intelligence. In June, it posted third-quarter results that fell short of market expectations. But the Irish company said it had strong bookings for generative AI. It added that it wants to be the reinvention partner of choice.
Blackberry (NYSE: BB) is no longer a leader in handheld devices. But it has successfully transitioned to the Internet of Things (IoT) and cybersecurity. It could even reinvent itself as a major player in the EV market.
Staying with the Internet of Things, Micron (Nasdaq: MU) is a serious player in the semiconductor industry. Its core products include Dynamic Random Access Memory (DRAM), NAND and NOR flash memory chips. Micron has beem overshadowed somewhat by NVIDIA. But its relevance as a force in AI should not be underestimated.
Costco Wholesale (NYSE: COST), with over 75 million members, is seen as a good barometer of the retail industry. It is also a past master of generating recurring revenues where membership fees matter more than any profit that it might make from selling goods from its warehouse shelves. In July, Costco said it would raise its membership fees for the first time in seven years. But it will be interesting to see if this has had an impact on membership renewals.
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