Investors navigated the choppy waters of Wall Street last week, with indexes meandering towards their best performance of 2024. The Federal Reserve held steady on interest rate cuts while optimism over artificial intelligence buoyed sentiment. The benchmark rallied to its highest weekly gain in months, setting sail at 2.3%. Meanwhile, tech and blue-chip indices surged by 2.9% and 2% respectively.
The upcoming week sets the stage for a bustling financial forecast amid AI-fueled Wall Street euphoria and speculation on interest rate movements. Eyes are keenly set on key economic indicators such as Friday’s core PCE price index, a pivotal measure for the U.S. central bank, with fourth quarter GDP data also in the spotlight.
Amidst this economic tempest, a barrage of Fed speakers, including heavyweights like Raphael Bostic, Christopher Waller, and Mary Daly, will take the stage post the FOMC meeting. Additionally, Fed Chair Jerome Powell will grace the Federal Reserve Bank of San Francisco’s event.
Speculation looms large in the market, with traders eyeing a probable June interest rate cut at 75%, as per Investing.com . On the corporate front, a sprinkling of earnings reports, including Carnival (NYSE:), Walgreens Boots Alliance (NASDAQ:), and GameStop (NYSE:), is due.
Ahoy, Carnival: Ready to Sail
Carnival (NYSE:) emerges as a beacon of hope for investors, expected to ride the waves of success this week. The cruise giant is poised to deliver a robust earnings report, capitalizing on soaring consumer travel demand trends. As the sun rises on Wednesday before the U.S. market opens, all eyes will be on Carnival’s first-quarter update.
Wall Street anticipates Carnival to navigate smoothly, with losses per share sharply narrowing to $0.18 from $0.55 year-over-year, reflecting a steady recovery from the Covid-19 pandemic. Revenue is set to surge by 22.7%, reaping the benefits of an upswing in tourism patterns.
Carnival’s share voyage ended at $17.09 on Friday, a high not seen since January, with a market cap of $21.3 billion, making it the second most valuable cruise operator globally. Cruise stocks, including Royal Caribbean and Norwegian Cruise Line, have set sail on a prosperous journey, capitalizing on pent-up travel demand amid pandemic delays.
Walgreens Boots Alliance: Storm Clouds Gathering
Contrastingly, Walgreens Boots Alliance (NASDAQ:) faces turbulent seas ahead, with a gloomy forecast on the horizon. The pharmacy giant is expected to grapple with disappointing earnings and guidance, likely leading to a downtrend. As Thursday dawns, a storm is brewing with Walgreens’ fiscal second-quarter update.
Analysts predict a sharp earnings decline of 28.5% year-over-year, alongside a mere 2.6% uptick in revenue. Mired in operational challenges and competitive pressures, Walgreens is grappling with decreasing market share and higher cost burdens.
Walgreens stock languished at $20.58 on Friday, hovering close to recent lows and shedding its Dow Jones Industrial Average membership. With a feeble ‘Financial Health’ score and dwindling investor confidence, the pharmacy chain finds itself adrift in troubled waters.
As investors brace for the week ahead, Carnival embodies the promise of new horizons, while Walgreens faces a menacing squall. The coming days will reveal whether these two titans of industry manage to navigate the unpredictable waters of the stock market, or if they get swept away by the tides of economic turmoil.