Wall St Week Ahead Inflation data poses test for stocks rally after Trump win

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NEW YORK, Nov 8 - Investors will focus in the coming week on whether inflation trends can help sustain the record-breaking stock rally that has received a boost from Donald Trump's victory in the U.S. presidential race.

The Nov. 13 consumer price index report needs to"confirm that notion that inflation continues to head in the right direction," said Art Hogan, chief market strategist at B Riley Wealth. More robust inflation could further alter projections for the Fed's rate-cutting path, after expectations changed with Trump's election victory. Fed funds futures show investors are now expecting rates to decline to about 3.7% by the end of 2025 from the current 4.5%-4.75% range, about 100 basis points above estimates in September.

"We ultimately think that they do take that shallow path because inflation is still a risk," Reynolds said."We just got through a period of well-above average inflation. Historically, that's come in waves." Investors also are continuing to adjust to the new political landscape, after big moves this week in the stock market's so-called"Trump trades." The small-cap Russell 2000 , was up 8% on the week, with smaller, domestically focused companies expected to benefit from Trump's plans to increase tariffs on imports.

 

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