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The S&P 500 Index is hovering near its all-time high as investors brace for major news events in the United States. The index, which tracks the biggest American companies, was trading at $6.665, up by 37% from its lowest point this year and a few points below the all-time high. This article explores some of the top S&P 500 and SPY news to watch this week.
US Inflation Data and Federal Reserve
One of the top S&P 500 Index news this week will come from the Bureau of Labor Statistics (BLS), which will publish the latest consumer price index (CPI) data on Friday despite the ongoing government shutdown.
The BLS deemed the report important because it is used by the Social Security Bureau when calculating the cost-of-living adjustment.
Economists believe that inflation continued its slow rise in September as companies continued to update their prices to deal with Donald Trump’s tariffs. The average estimate is that the headline Consumer Price Index (CPI) rose from 2.9% in August to 3.1% in September. Core inflation, which excludes the volatile food and energy prices, is expected to remain at 3.1%.
A higher inflation figure than expected will complicate the Federal Reserve’s outlook. Cutting interest rates will boost inflation, while hiking will slow the economy.
The report comes a few weeks after another report by ADP showed that the private sector lost 36,000 jobs in September.
In line with the upcoming US inflation report, the S&P 500 Index will react to the upcoming statements by some key Federal Reserve officials like Christopher Waller, John Williams and Michele Bowman.
US and China Trade Talks
The other notable catalyst for the S&P 500 Index is the upcoming trade talks between the US and China, which will happen this week. These talks will be between Scott Bessent, the Treasury Secretary, and the Chinese Premier.
They will aim to solve some of the outstanding issues between the two countries ahead of the upcoming meeting between Donald Trump and Xi Jinping. The two presidents will meet at the APEC meeting in South Korea next week.
According to Bloomberg, Trump wants the Chinese to stop the flow of fentanyl to the US, continue shipping rare earth materials, and start buying US soybeans.
On the other hand, China believes that it has a higher leverage against the US. For one, the trade war has pushed it to focus on the rest of the world and building it own semiconductors.
Hopes of a trade deal between the two countries will boost the stock market in the US.
S&P 500 Index to React to Key Earnings
The S&P 500 Index will also react to the upcoming earnings dump as over 100 companies publish their numbers. The most notable of them are Tesla and Nvidia, which are parts of the Magnificent 7.
Other companies to watch are blue-chip names like General Electric, Coca-Cola, Philip Morris, RTX, Danaher, IBM, and BlackStone.
China Political Meeting to Impact US Stocks
The other key catalyst for the S&P 500 Index will be China, where the Communist party is holding the Fourth Plenary Session. This is an important meeting where Xi Jinping and other officials are evaluating the success of the 15-year strategic plan.
This meeting comes as the trade war with the United States continues and as a report showed that the economy was slowing. According to the statistics agency, the economy grew by 4.8% in the third quarter, the slowest rate this year.
Chinese developments are important for American companies because many companies have exposure there. Some of the top American companies with an exposure to China are big names like Tesla and Apple.
Therefore, the S&P 500 Index could continue its rally if there are signs of a deal with the US, if earnings growth continues, and if the US inflation numbers comes short of expectations.
