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Investing.com — After shaking off a higher than expected consumer price index reading for June on Tuesday, stocks continued their upward climb on Wednesday.
Federal Reserve Chairman Jerome Powell began the first of two days of testimony in Congress on Wednesday as the central bank’s Beige Book, a periodic report on economic observations from its member banks, was released.
Anecdotally, some businesses are still struggling to fill jobs, the report said, and the gap in supply and demand in the labor market doesn’t seem likely to abate soon.
Inflation accompanied reopening activity, with pricing pressures growing in the hospitality sector, as the reopening of hotels and restaurants confronted limited supplies of materials and workers.
Big banks continued to report a rebound in earnings, though some of the biggest U.S. lenders, including Wells Fargo & Company (NYSE:WFC), reported sluggish loan activity as stimulus-flush households kept borrowing low, at least in the second quarter.
Here are three things that could affect markets tomorrow:
1. Last of the big bank earnings
After a week of big bank earnings, which mostly showed strong gains over last year, Morgan Stanley (NYSE:MS) will be the final to report on Thursday. Analysts tracked by investing.com expect it to post earnings per share of $1.66 on revenue of $13.98 billion for the second quarter.
2. More testimony from Fed
Federal Reserve Chair Jerome Powell’s two-day Congressional testimony will continue Thursday. In prepared remarks for the House Financial Services Committee, Powell told the members Wednesday that the economy needs to improve more before the central bank tightens its ultra-easy monetary policy. He said the Fed would give adequate notice before it begins the pullback.
3. Production data
Production numbers are scheduled for release at 9:15 AM ET (1315 GMT) on Thursday. Industrial production is expected to increase 0.6% for June from May, compared to the 0.8% gain in the prior month period. Manufacturing production is expected to edge up 0.2% for the month of June, compared to 0.9% for May.
