Stocks Mixed After Weaker-Than-Expected Retail Sales Report

U.S. has just provided Retail Sales report for May. Retail Sales decreased by 1.3% month-over-month in May compared to analyst consensus which called for a decline of 0.8%.

On a year-over-year basis, Retail Sales grew by 28.1% as they were under significant pressure in May 2020. Excluding Autos, Retail Sales decreased by 0.7%.

S&P 500 futures are mostly flat after the release of the Retail Sales report. The report missed analyst estimates, but the market remains focused on the Fed Interest Rate Decision which will be released on Wednesday, and it looks that it is not ready for big moves.

Producer Prices Grew By 0.8% In May
U.S. has also released Producer Prices reports for May. On a month-over-month basis, Producer Prices increased by 0.8% compared to analyst consensus of 0.6%. Year-over-year, Producer Prices grew by 6.6% compared to analyst consensus which called for growth of 6.3%.

Inflation is clearly rising faster than expected, but the key question is whether Fed will do anything about it, or it will remain committed to its dovish stance. If Fed is more hawkish than expected on Wednesday, stocks may find themselves under pressure.

Today, traders will also have a chance to take a look at Industrial Production and Manufacturing Production reports. Analysts expect that Industrial Production increased by 0.6% month-over-month in May while Manufacturing Production also grew by 0.6%.

WTI Oil Moves To New Highs
WTI oil is currently trying to settle above the $72 level as rally continues. From the technical point of view, RSI has recently moved to the overbought territory so the risks of a pullback are increasing, but traders stay focused on the rebound of demand for oil.

In addition, it looks that there is little progress in negotiations with Iran. At this point, the oil market is not worried about the potential return of Iranian oil, and WTI oil looks ready to get to the test of the psychologically important $75 level.

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