--- title: 'Stock Market Outlook: After Fed’s Rate Hike, Investors Eye Inflation and Regional Banks' description: After earnings reports and the Fed's latest rate hike, investors will be watching inflation data and the banking sector in the week ahead. authors: - name: Mallika Mitra role: Contributing Editor url: https://money.com/author/mallika-mitra/ bio: Mallika Mitra is a contributing editor for Money, based in Chicago. She has covered investing and retirement for seven years and her work has appeared in CNBC, Bloomberg, Kiplinger, AARP, Barron’s, Bankrate, The Daily Upside, ETF.com, The Bond Buyer, PLANADVISER, PLANSPONSOR and Investopedia. education: Craig Newmark Graduate School of Journalism at CUNY Kalamazoo College at_money_since: 2020 articles: 395 covers: - Economy and Politics - Banking - Business - Career Advice - Credit - Credit Cards - Debt - Education - Health and Wellness - Housing - Identity Theft - Insurance - Investing - Lifestyle - Loans - Mortgages - Personal Finance - Pets - Professional Services - Retirement - Shopping - Taxes - Technology also_seen_in: - CNBC - Bloomberg - Kiplinger - Barron's - Bankrate - WGN-TV - CBS News Radio - This Morning With Gordon Deal - Everyone's Talkin' Money social: - https://twitter.com/mitra_mallika - https://www.linkedin.com/in/mallika-mitra-4577a386/ editors: - name: Brad Tuttle role: Senior Editor url: https://money.com/author/brad-tuttle/ bio: Brad Tuttle is a former senior editor at Money with over 10 years’ experience covering a vast number of personal finance topics, including careers, cars, travel, budgeting, investing, insurance, credit cards, consumer psychology, real estate, banking, and shopping and deals. education: Columbia University School of Journalism, MS at_money_since: 2014 articles: 366 covers: - Economy and Politics - Banking - Business - Career Advice - Credit - Credit Cards - Education - Health and Wellness - Housing - Identity Theft - Insurance - Investing - Lifestyle - Loans - Mortgages - Personal Finance - Pets - Professional Services - Retirement - Shopping - Taxes - Technology social: - https://twitter.com/bradrtuttle - https://linkedin.com/in/brad-tuttle-834b225 former_staff: true published: '2023-05-05T18:05:48.000Z' modified: '2024-04-29T06:06:44.000Z' section: Economy and Politics tags: - News - stocks word_count: 559 canonical: https://money.com/weekly-stock-market-outlook/ type: NewsArticle source: structured-blocks --- > **Disclosure:** We research all brands listed and may earn a fee from our partners. Research and financial considerations may influence how brands are displayed. Not all brands are included. [Learn more](https://money.com/page/disclaimer/). ![Markets Open After Losing Nearly 700 Points On Concerns Fed Will Keep Interest Rates High](https://img.money.com/2023/02/News-Stock-Outlook.jpg) The past week has been a busy one for the markets. The Federal Reserve [hiked interest rates](https://money.com/fed-raises-rates-last-time/) another quarter of a percentage point, companies continued to [report their earnings](https://money.com/investors-too-hopeful-about-tech-earnings/) from the first quarter of the year, and regional banks became a focus for investors. What's next? Now that the majority of key earnings reports are out, the market will be more focused on the macroeconomic picture for the foreseeable future, says Todd Jones, chief investment officer at Gratus Capital. The key driver, he says, will be how the situation with the regional bank system unfolds — and if there is another shoe to drop. Here’s what investing experts will be watching the week of May 8: [Regional bank stocks](https://money.com/should-you-buy-regional-bank-stocks/) have been in turmoil amid widespread fear about the stability of the banking sector. For example, he stock price of PacWest Bancorp — a regional bank based in California — plummeted more than 50% on Thursday, continuing a selloff that began earlier in the week. Investors will be monitoring U.S. banking sector developments very closely over the next several days, since the recent events caused a renewed selloff in bank stocks and more volatility across the markets, says Phillip Colmar, managing partner and global strategist at MRB Partners, an independent investment research firm. There's also fear around whether or not more banks will get caught up in the turmoil. "The question of 'who’s next' is an important one to consider," Jones adds. ## Inflation data When the Fed hiked interest rates during its most recent meeting amid its ongoing battle with [inflation](https://money.com/ways-supplement-income-high-inflation/), it also signaled that rate increases could now be on pause. That's not at all guaranteed, but just the fact that the central bank is no longer saying it *anticipates* more hikes is significant news for investors, since rate hikes weigh on the financial assets like [stocks](https://money.com/how-to-buy-stocks/). Sam Stovall, chief investment strategist at research firm CFRA, tells Money that looking at the Fed's moves since 1989, the [S&P 500](https://money.com/how-to-invest-in-sp500/) gained an average of 13% during the time between the last rate hike and first rate cut. The S&P gained in price in five out of six of those periods, too. The Fed didn't set the stage for a cut this year — Stovall says the first decrease in rate hikes may not come until 2024 — but the Fed and investors alike will continue to keep a close eye on economic data to glean insight into whether or not more rate hikes will be needed. That data includes the April core consumer price index (CPI), which is a closely-watched inflation measure and will be released by the Bureau of Labor Statistics on Wednesday. "Core price pressures have proven sticky so far and are likely to remain so unless the economy is heading into recession and employment and wages soften noticeably," Colmar says. Another inflation gauge, the producer price index (PPI), which measures the costs of goods and services in the eyes of producers, will come out Thursday. And on Friday, May 12, the Michigan Sentiment Survey, will give investors a read on how confident consumers are feeling about the U.S. economy. [Regional Bank Stocks Are in Turmoil. Is It a Buying Opportunity for Investors?](https://money.com/should-you-buy-regional-bank-stocks/) [Why Investors Shouldn’t 'Sell in May and Go Away' This Year](https://money.com/should-investors-sell-in-may-and-go-away/) [7 Best Online Trading Platforms of 2023](https://money.com/best-online-stock-trading/) ```json { "@context": "https://schema.org", "@graph": [ { "@type": "BreadcrumbList", "@id": "https://money.com/weekly-stock-market-outlook/#breadcrumb", "itemListElement": [ { "@type": "ListItem", "position": 1, "name": "Home", "item": "https://money.com" }, { "@type": "ListItem", "position": 2, "name": "Economy and Politics", "item": "https://money.com/economy-and-politics/" }, { "@type": "ListItem", "position": 3, "name": "Stock Market", "item": "https://money.com/stock-market/" }, { "@type": "ListItem", "position": 4, "name": "Stock Market Outlook: After Fed’s Rate Hike, Investors Eye Inflation and Regional Banks" } ] }, { "@type": "WebSite", "@id": "https://money.com/#website", "url": "https://money.com", "name": "Money", "publisher": { "@id": "https://money.com/#organization" } }, { "@type": "WebPage", "@id": "https://money.com/weekly-stock-market-outlook/#webpage", "url": "https://money.com/weekly-stock-market-outlook/", "name": "Stock Market Outlook: After Fed’s Rate Hike, Investors Eye Inflation and Regional Banks", "isPartOf": { "@id": "https://money.com/#website" }, "datePublished": "2023-05-05T18:05:48.000Z", "mainEntity": { "@id": "https://money.com/weekly-stock-market-outlook/" }, "inLanguage": "en-US", "breadcrumb": { "@id": "https://money.com/weekly-stock-market-outlook/#breadcrumb" }, "dateModified": "2024-04-29T06:06:44.000Z" }, { "@type": "NewsArticle", "headline": "Stock Market Outlook: After Fed’s Rate Hike, Investors Eye Inflation and Regional Banks", "articleSection": "Economy and Politics", "image": [ { "@type": "ImageObject", "url": "https://img.money.com/2023/02/News-Stock-Outlook.jpg", "width": 2700, "height": 1800, "caption": "News-Stock-Outlook" } ], "author": [ { "@type": "Person", "name": "Mallika Mitra", "url": "https://money.com/author/mallika-mitra/", "@id": "https://money.com/author/mallika-mitra/#author", "description": "Mallika Mitra is a contributing editor for Money, based in Chicago. 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