Markets can be volatile, as investors await a very hawkish message from Federal Reserve officials at their annual Jackson Hole economic symposium over the weekend. Fed Chairman Jerome Powell speaks Friday at 10 a.m. ET, a highlight of the three-day Wyoming conference that begins Thursday. Fed watchers expect tough talk from the chairman, as he reinforces the central bank’s goal of quelling inflation and keeping expectations of future price increases in check. To that end, Powell and other Fed officials are expected to say they want to keep rates higher for longer than some investors now expect, and that message could lead to an unstable response. “If someone is thinking there might be some sign that they are coming to an end, they are not getting it,” said Tony Crescenzi, executive vice president and portfolio manager at Pimco. “It would challenge the policy that worked during the last inflationary period of the 1970s, where stop-and-go policy was rejected. It’s more likely to be stop-and-hold policy this time around. .” What else to watch In addition to the Fed-related news coming out over the weekend, there are several economic reports that will be important to keep an eye on. There are new home sales and S&P global services PMI and manufacturing data on Tuesday. Durable goods and pending home sales will no longer operate on Wednesday. Personal consumption spending data, including the Fed’s preferred measure of inflation, is released Friday morning before Powell speaks. Retailers will continue to release quarterly results, including Macy’s and Nordstrom on Tuesday. There will also be reports from Gap, Urban Outfitters and Dollar Tree, among others. Expect the Fed’s Wyoming meeting to be a major catalyst, however. “The only thing that matters is Jackson Hole,” said Julian Emanuel, head of equity, derivatives and quantitative research at Evercore ISI. Stocks have been volatile and lower over the past week. The S&P 500 index fell 1.2% for the week, its first drop in four weeks of gains. Some strategists note that wild trading in meme stocks, like the big swings in Bed Bath & Beyond can sometimes be a warning that speculation is running too high and the market is nearing a top. The market is also heading for the negative month usually September. Some chart strategists expect to see the market pull back after that and possibly October. They expect to profit from selling in the fourth quarter, historically a positive time in midterm election years. “Given the seasonality, risk and coldness of meme trading, and what could have been a hawkish message at Jackson Hole, risk is the downside,” Emanuel said. Emanuel said the market is in a tough spot. Some strategists believe the stock may have entered a new bull market as more than 90% of S&P 500 companies have risen above their 200-day moving averages through the end of last week. However, the S&P 500 approached its 200-day moving average over the past week and then reversed course. 200 days at 4,320 Friday. It is simply the average of the last 200 closes and it acts as a momentum indicator. A close higher than it will signal more gains. “Like everything else, because you’re so close to the 200-day moving average in the S&P, it’s really hard to determine when it’s going to be a bear market rally, a new bull market. or you’re entering this indecision zone, Emanuel said, Treasury yields have been higher than Jackson Hole’s. On Friday, the benchmark 10-year Treasury yield was at 2.98%, close to 3% level not seen since mid-July Jackson Hole Risks Market debate focuses on how much the central bank will raise interest rates at its upcoming meeting on September 20 and 21. . In March, the Fed raised its loan fund target range to 2.25% to 2.5%. At the end of the year, the futures market is pricing in a lending rate range of 3.25% to 3.5%. .5% Futures market heading for high rate from 3.5% to 3.75%, for next April, and then it shows a cut of at least a quarter in the second half of the year. “The Fed is trying to drive the bull runs first,” said Peter Boockvar, chief investment officer at Bleakley Advisory Group. “They’re trying to get it out of their system and cool it down next year. The question is do we go from cooling down to cutting, but I think the Fed is trying to clarify this week.” , that’s not on their agenda.” Boockvar said Powell is unlikely to break new policy ground in his speech, as former Chairman Ben Bernanke did when he discussed quantitative easing during the financial crisis. “He outlined his flight plan,” Boockvar said. Some Fed officials have emphasized that the central bank will not start cutting once it reaches the final rate, and instead , it can pursue a policy of higher interest rates. San Francisco Fed President Mary Daly said Thursday that she favors a “lift and hold” strategy and that once rates reach a certain level, she does not expect the Fed to reverse course. “It’s better for the Fed to show tough love and be wary of inflation than to give up,” Crescenzi said. He said if the central bank took a “stop and go” policy, interest rates would be higher simply because investors would think the Fed slowed policy too soon to crush inflation. In the last week, some investors commented in the minutes of the central bank’s last meeting as more dovish as they indicated that the Fed would slow down the size of the cuts. But Fed watchers say the more hawkish message is clear. “This is where people are squinting for pigeons, and they’re still hawks. The Fed wants to raise rates, stay the same, and once you see inflation is no longer a hawk,” said Diane Swonk, chief economist at KPMG. problems, they will ease,” said Diane Swonk, chief economist at KPMG. “That process is not something that can happen between now and the end of the year.” Swonk said the Fed has no plans to reverse policy, as some market players predicted. “They’re worried about inflation. The markets want to keep coming back to where we are, where the Fed usually takes quick turns. That’s where we are,” she said. “The Fed has learned, perhaps in error, that it was wrong when inflation was transient and also worried about a more fixed inflation.” Barclays strategists note that Fed rate expectations have increased recently, but those rate cuts are still priced into the second half of next year. “Powell’s speech at Jackson Hole next week should [an] “Key catalyst that could drive a realignment of asset x performance,” the strategists wrote in a note. “The key for equities is whether Powell will push back his view of the 2023 easing cycle and head for higher terminal rates if he holds the option.” Technically, when the traders wait for Jackson Hole, the market seems to be popping more negative warnings, according to several chart-watching strategists.” Feels like summer August tops are in, looking at the action In the meme Scott Redler, T3 Live’s Chief Strategist, said there are signs that momentum is slowing down and that extreme frost is causing traders to take risks and potentially profit. short-term gains.” Redler said: “The S&P ascending channel dropped below the critical 4,250 level and stayed there. The S&P index ended the week at 4,228. He said: “Since the lows most of the month of June, we were in an uptrend”. . . “Last week’s previous calendar Monday earnings: Palo Alto Networks, Video Zoom Thu Tuesday: Macy’s, Nordstrom, Toll Brothers, Intuit,Urban Outfitters, La-Z-Boy, Advance Auto Parts, JM Smucker, JD.com, Dick’s Sporting Goods, Medtronic 9:45 am S&P Global Manufacturing PMI 9:45 am S&P Global Services PMI 10:00 am New Home Sale 7:00 pm Minneapolis Fed President Neel Kashkari Wednesday earnings: Nvidia, Salesforce, Box, Royal Bank of Canada, Snowflake, Victoria’s Secret, Petco, Brinker International, NetApp, Autodesk 8:30 am Durable goods 10:00 a.m. Home Sales Pending Thursday Jackson Hole Economic Symposium Begins Earnings: Dell Technologies, Gap, Affirm Holdings, Peloton Interactive, Royal Bank of Canada, Toronto-Dominion, Burlington Stores, Shoe Carnival , Dollar Tree, Dollar General, Coty, Ulta Beauty, Marvell Technology, VMWare, Workday, Grab Holdings, Abercrombie & Fitch, Hain Celestial 8:30 a.m. Initial statement 8:30 a.m. Q2 Real GDP (Monday) Friday 8:30 a.m. Personal Consumption Spending 8:30 a.m. economic indicators before 10:00 a.m. consumer sentiment 10:00 a.m. Fed Chairman Jerome Powell economic speech at Jackson Hole