Next week is the last with significant data and events of 2022. First comes the November CPI Report on Tuesday December 13 at 8:30am EST. As long as it isn’t above October’s 7.7% I think the market should be fine. Barring an outlier CPI Report the Fed – which will issue its interest rate decision Wednesday December 14 at 2:00pm EST – will raise 50 basis points. As you can see in the chart above the market is placing a 78% chance of that occurring and only a 22% chance of a 75 point hike. If all goes according to plan I wouldn’t expect a huge market reaction.
The two earnings reports I’ll be focusing on are from homebuilder Lennar (LEN) on Wednesday afternoon and midmarket restaurant chain Darden (DRI) on Thursday afternoon. Last week Toll Brothers (TOL) reported a 60% decline in contracts compared to a year ago. I’ll be looking to see if contracts are rolling over at LEN as well for confirmation that the housing market is entering a bust.
I’ll also be focusing on comps at DRI – owner of the Olive Garden among other midmarket restaurants – to see how the middle class consumer is holding up and managing discretionary spending.