US stocks are attempting a second leg up on Thursday, clawing back after Tuesday’s inflation-induced selloff. Investors are cautiously optimistic, awaiting January retail sales figures that could provide clues about the health of the American economy and the Federal Reserve’s monetary policy path.
The S&P 500, a broad market index, is inching up 0.1%, flirting with the psychologically important 5,000 level once again. Similar gains are seen in the Dow Jones Industrial Average and the tech-heavy Nasdaq. This follows a robust rally on Wednesday, where markets recovered a chunk of the losses incurred after a hotter-than-expected inflation report spooked investors earlier this week.
Comments from Federal Reserve officials downplaying the significance of the inflation data helped calm nerves, but questions remain. Was Tuesday’s selloff a temporary hiccup, or the beginning of a more prolonged correction? Many analysts point to signs of underlying strength despite the recent volatility.
Today’s focus shifts to January retail sales figures, which unexpectedly fell 0.8% compared to the previous month. This raises concerns about consumer resilience and the possibility of a “no landing” scenario, where the Fed achieves inflation control without triggering a recession.
Later in the day, investors will be glued to remarks from Fed officials Christopher Waller and Raphael Bostic, hoping to glean further insights into the central bank’s thinking. Bostic’s comments, scheduled after market close, could hold particular weight due to their timing.
Overall, the mood on Wall Street is cautiously optimistic. The bulls are hoping for a soft landing, while the bears remain wary of potential headwinds. Today’s January retail sales figures and Fed commentary could provide critical turning points in determining the market’s near-term trajectory.
Key takeaways:
- US stocks inch higher after Wednesday’s recovery.
- Retail sales data raises concerns about consumer spending.
- Fed officials’ comments in focus, particularly Bostic’s remarks after market close.
- Market sentiment remains cautious as investors weigh economic data and Fed policy signals.
