Fed decision, producer prices, Lennar earnings: 3 things to watch

Investing.com -- Stocks rose on Tuesday after cooler-than-expected inflation numbers for May stoked hopes that the Federal Reserve would stop, or at least pause, its interest rate increases.

Investors are looking forward to tomorrow's decision by the Fed, expected out in the early afternoon, followed by a press conference with Chair Jerome Powell.

Along with the rate decision will come the policy makers' newest forecasts for inflation, unemployment and economic output this year, in the form of the quarterly dot-plot sheet.

Tech stocks, including Apple (NASDAQ:AAPL) and Meta Platforms Inc (NASDAQ:META), have been rising in recent days on the hope that the Fed's rate tightening is over. The S&P 500 has been lifted to new highs for the year.

But futures traders aren't convinced it will be the last of the Fed's actions on inflation. More than half see the probability of a quarter of a percentage point rate increase in July.

Here are three things that could affect markets tomorrow:

1. Fed decision

The Fed's rate decision will be announced at 14:00 ET (18:00 GMT), followed by the press conference at 14:30 ET, which will be live-streamed. Investors are hoping to get more clues on the Fed's thinking from Powell's reaction to questions from reporters, including the possibility of further rate hikes and his views on when the Fed can start to pivot.

2. Producer prices

The PPI for May is due out before the Fed decision, at 8:30 ET. Analysts are expecting producer prices to climb 1.5% over the year ending in May and fall 0.1% for the month.

3. Lennar earnings

Analysts expect home builder Lennar Corporation (NYSE:LEN) to report earnings per share of $2.31 on revenue of $7.18 billion.