U.S. stocks are mixed as investors await inflation report for June

Investing.com -- U.S. stocks were mixed on Monday ahead of inflation data for June.

At 10:39 ET (14:39 GMT), the Dow Jones Industrial Average rose 145 points or 0.4%, while the S&P 500 was up 0.1% and the NASDAQ Composite fell 0.1%.

Inflation report will factor into Fed decision

Investors are awaiting a key report on inflation after weak data in China stoked concerns about a possible economic slowdown. The Federal Reserve will factor the inflation data for June – set to be released Wednesday – into its decision later this month on interest rates.

Analysts expect that the pace of growth in inflation cooled last month and will record the lowest growth since March 2021.

This data is coming on top of Friday’s jobs report that said the U.S. added the fewest jobs last month since 2021. Unemployment also dipped and wages grew more than expected, indicating a tight labor market that could complicate the Fed’s decision-making on the direction of interest rates.

Fed aiming for a soft landing

The Fed has been trying to guide inflation back to its 2% target without tipping the economy into a recession that could result in significant job losses.

Futures traders expect the Fed will raise rates by a quarter of a percentage point this month and keep it there until perhaps November, when it could raise again.

The prospect of the Fed coming to an end to its rate hiking phase helped lift technology stocks in the first half of the year, with the Nasdaq jumping 32%. Citi has now downgraded U.S. stocks to neutral, saying megacap is due for a pullback.

Big banks kick off a new earnings season

Big banks kick off earnings season later this week, giving investors clues on the health of the business and consumer sectors, though loan growth and credit quality will be a focus of analysts.

JPMorgan Chase & Co (NYSE:JPM), Citigroup Inc (NYSE:C) and Wells Fargo & Company (NYSE:WFC) are scheduled to report on Friday.

Shares of activist investor Carl Icahn’s company, Icahn Enterprises LP (NASDAQ:IEP), rose 16% after a report that said he and his banks have amended loan agreements to delink his personal loans from the company’s trading price.