Stocks Snap Four-Day Skid Despite Hot CPI, Attention Turns to the FOMC
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A Snapshot Before I Go
One last thing before I bid you all adieu and get ready to lock in for the Oracle ($ORCL) and Adobe ($ADBE) earnings calls.
Here’s a snapshot of what the market expects for tomorrow’s August CPI report:
The headline CPI figure is expected to come in at 3.4% on a year-over-year basis, matching the July figure. The core reading for August is expected to inch lower to 2.4% from 2.5% in July.
While many tend to focus on the core figure, with food and gas accounting for 20%-25% of the average paycheck, it’s hard to think consumers aren’t feeling the pinch of current gas prices or the continued rise in food prices found in the FAO Food Price Index.
Later in the day, the University of Michigan will publish its preliminary September reading for Consumer Inflation Expectations and the market sees it clocking in at 3.9%, down a tick from 4.0% in August.
Position: None
Adobe and Oracle
After today’s market close, Adobe ($ADBE) and Oracle ($ORCL) report their quarterly results.
For Adobe, which is expected to deliver EPS of $6.09 on $6.7 billion in revenue, it will be the first earnings since it announced Anil Chakravarthy will succeed Santanu Narayen as CEO December 1. Now to see if outgoing CEO Narayen delivers guidance that matches Wall Street’s expectation for the final quarter under his tenure. For Adobe’s November quarter, Wall Street sees EPS of $6.33 on $6.85 billion in revenue.
Turning to Oracle, the market consensus is for the company to post EPS of $1.74 on $19.13 billion in revenue for its August quarter. For the current one, those figures are $1.89 and $21.17 billion. In addition to those figures, we’ll be following Oracle’s remaining performance obligations (RPOs), which stood at $638 billion exiting its May 2026 quarter. During that May quarter, management booked $67 billion in AI infrastructure contracts. We’ll also be looking to see if Oracle increases its capital spending plan for its fiscal 2027 beyond the $70 billion shared back in June.
In reviewing both earnings releases and corresponding earnings calls, we will also be mindful about what is said pertaining to the pace of AI adoption and usage.
Position: None
Equity Slide Enters Fourth Day
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My even market wrap-up is a summary of everything you should know for successful trading.