US May core PCE to be released, Powell to appear on Capitol Hill, Nvidia to hold its annual shareholders meeting [The week ahead]

TradingKey - Last week, US stocks saw mixed movements as the Federal Reserve maintained its expectation of two interest rate cuts this year during the last monetary policy meeting of the first half of the year, but indicated that the impact of tariff issues has yet to materialize. This week, Fed Chairman Jerome Powell will appear on Capitol Hill to deliver his semiannual monetary policy testimony. On Friday, the US will release the May PCE price index, with the core PCE price index being of greatest interest to investors. Nvidia will hold its 2025 Annual Shareholders Meeting on June 25, and as the world's largest tech giant, investors will be paying attention to its latest developments. The 2025 Summer Davos Forum will take place next week from Tuesday to Thursday. In terms of stocks, this week is still considered the off-season for earnings reports, but several well-known companies, including FedEx (FDX.N), Micron Technology (MU.O), and Nike (NKE.N), will be announcing their latest earnings results in succession.

Major Events Preview

The Fed's Preferred Inflation Indicator: Core PCE is Coming

The Federal Reserve’s preferred measure of inflation, the Core Personal Consumption Expenditures (PCE) Price Index, will be released on Friday, providing clues for future interest rate trends. On the same day, the final consumer sentiment index for June from the University of Michigan will also be published.

As inflation is being brought under control and the temporary truce in the US-China trade war continues, investors are expecting a rebound in market confidence. Mark Hackett, Chief Market Strategist at Nationwide, stated that although the data from surveys in March, April, and May have been poor, the market will still see signs of economic recovery.

The U.S. Involvement in the Israel-Iran Conflict Brings New Uncertainty to the Market

The U.S. involvement in the Israel-Iran conflict has introduced a new wave of uncertainty to the markets, potentially leading to a larger-scale conflict in the Middle East. President Donald Trump announced that the U.S. has struck three major nuclear enrichment facilities in Iran, claiming the attacks were successful and that these facilities have been "completely destroyed." He also threatened to launch further strikes against Iran if the country does not promptly seek peace negotiations.

If Iran orders the closure of the Strait of Hormuz, oil prices will undoubtedly be significantly impacted, as this strait accounts for about one-fifth of the global oil and gas transport routes.The Strait of Hormuz will undoubtedly have a significant impact on oil prices. About one-fifth of the world's oil and natural gas is transported through this strait. Wall Street analysts warned that if the Strait of Hormuz is closed, oil prices may rise to as high as $120-130. Recently, analysts on Wall Street cautioned that should the U.S. intervene in regional conflicts, U.S. stocks could experience a subconscious sell-off. A surge in oil prices could affect the U.S. economy, leading to rising inflation and forcing the Federal Reserve to delay interest rate cuts.

Will Powell Release More Monetary Policy Signals While at Capitol Hill?

Federal Reserve Chairman Jerome Powell will make a crucial defense of monetary policy on Capitol Hill this week. According to the schedule, he will present the semiannual monetary policy report and testify before the House Financial Services Committee on Tuesday, June 24, and before the Senate Banking Committee on Wednesday, June 25.

Bloomberg analysts predict that Powell is likely to reiterate the Fed's cautious policy stance. While there remains the possibility of interest rate cuts this year, they hope to further clarify the economic impact of White House trade policies before considering any rate reductions.

Nvidia Holds Annual Shareholders Meeting

Nvidia (NVDA.US) will hold its 2025 Annual Shareholders Meeting at 9:00 AM Pacific Time on June 25 (which will be June 26, 12:00 AM Beijing Time). Nvidia is committed to expanding its influence in the global AI infrastructure sector. This month, the company announced plans to build an industrial AI cloud platform in Germany and has designated Micron Technology as the first supplier for its new memory solution, SOCAMM.Recently, Nvidia also announced a partnership with Novo Nordisk to use AI in drug development and showcased a video compression tool for autonomous vehicles at the GTC conference in Paris.

Selected Economic Data

Tuesday: U.S. Conference Board Consumer Confidence Index for June

Thursday: Final Q1 Annualized GDP Growth Rate for the U.S.

Friday: Year-over-Year Core PCE Price Index for May

Key Events This Week

Monday: ECB President Christine Lagarde's Speech

Tuesday: Powell's Testimony on Monetary Policy Report

Thursday: NATO Heads of State and Government Summit in The Hague, with Trump confirming attendance

Company Earnings Reports

Tuesday: FedEx (FDX.N)

Wednesday: Micron Technology (MU.O)

Thursday: Nike (NKE.N)