Powell, PCE and Other Key Thing to Watch this Week

• StockStory Top Pick SNOW +1.04% CRWD +1.52%
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Markets enter December facing a week packed with comprehensive economic data, high-profile earnings, and multiple Fed Chair Powell appearances that together could determine the trajectory for both the final month of 2025 and early 2026 positioning. The week begins with Monday's manufacturing sector assessment through PMI and ISM data, followed by Powell's evening speech at 8:00pm that will be scrutinized for insights into the December rate decision following recent economic data and market volatility. Wednesday delivers an intensive convergence of cloud software earnings from Snowflake (SNOW) and Salesforce (CRM) alongside comprehensive services sector data that will provide critical perspectives on both enterprise technology spending and broader economic activity. Tuesday's earnings from CrowdStrike (CRWD) and Marvell (MRVL) will test cybersecurity and semiconductor demand amid ongoing questions about technology spending resilience. Friday's Core PCE Price Index represents the Fed's preferred inflation measure and will significantly influence December meeting expectations just two weeks before the policy decision. The combination of manufacturing and services data throughout the week will paint a comprehensive picture of economic momentum heading into year-end.

Here are 5 things to watch this week in the Market.

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Manufacturing Sector and Powell's Policy Preview

Monday delivers a comprehensive manufacturing assessment through the Manufacturing PMI at 9:45am, ISM Manufacturing PMI at 10:00am, and Chicago PMI at 9:45am that together will provide detailed insights into industrial sector health, new orders, employment trends, and pricing pressures. The ISM Manufacturing Prices component will be particularly important for assessing inflationary pressures at the business level ahead of Friday's PCE data. Monday evening's speech by Fed Chair Powell at 8:00pm takes on heightened significance as potentially the final major Fed communication before the December meeting blackout period. Powell's commentary about recent economic data, inflation progress, labor market conditions, and the appropriate policy path will be closely scrutinized for any hints about the December rate decision. The unusual evening timing on a Monday creates potential for significant market reactions in overnight futures trading. Any dovish signals could support risk assets and reinforce expectations for December accommodation, while hawkish tones could trigger concerns about the Fed pausing its cutting cycle sooner than markets anticipate.

Cloud Software Earnings: Enterprise Spending Litmus Test

Wednesday's earnings convergence from Snowflake (SNOW) and Salesforce (CRM) represents a critical test for cloud software valuations and enterprise technology spending trends heading into 2026. Snowflake's results will provide insights into data analytics demand, cloud data warehouse adoption, and AI-driven product consumption that has been central to the company's growth narrative. The company's ability to maintain growth rates amid increased competition and questions about AI monetization will be crucial for sector sentiment. Salesforce's earnings will offer comprehensive perspectives on CRM software demand, enterprise AI adoption through Einstein and Agentforce platforms, and customer spending patterns across different business segments. The company's guidance about corporate IT budgets and deal pipeline strength will help determine whether enterprise software can maintain resilience despite broader economic uncertainties. Both companies face high expectations following strong runs in cloud infrastructure stocks, making their results and forward guidance particularly important for validating current valuations and technology sector leadership heading into year-end.

Cybersecurity and Semiconductor Demand Dynamics

Tuesday's earnings from CrowdStrike (CRWD) and Marvell (MRVL) will provide contrasting perspectives on cybersecurity spending and semiconductor demand across different end markets. CrowdStrike's results will offer insights into endpoint security adoption, cloud security platform growth, and enterprise security spending priorities. The company's commentary about threat landscape evolution, competitive dynamics, and customer retention will be particularly important following recent scrutiny of cybersecurity vendor reliability. Marvell's earnings will provide crucial insights into data center networking chip demand, AI infrastructure investment sustainability, and automotive semiconductor trends. The company's exposure to cloud service providers and enterprise data centers makes its results relevant for assessing whether AI-driven chip demand can sustain momentum beyond flagship GPU accelerators. Marvell's guidance about custom AI chip design wins and optical connectivity demand will help determine whether the broader semiconductor ecosystem is participating in AI infrastructure buildouts or if spending is narrowly concentrated.

Services Sector and Employment Indicators

Wednesday delivers comprehensive services sector assessment through the Services PMI at 9:45am and ISM Non-Manufacturing PMI at 10:00am, providing critical insights into business activity across the economy's largest sector. The ISM Non-Manufacturing Prices component will offer additional inflation perspectives ahead of Friday's PCE data. Wednesday's ADP employment report at 8:15am will provide a private sector jobs preview, while Tuesday's JOLTS job openings data will offer perspective on labor demand trends and worker mobility patterns. Thursday's initial jobless claims will round out the employment picture ahead of next week's official jobs report. The convergence of services activity data and employment indicators will help markets assess whether the economy is maintaining momentum heading into year-end or showing signs of deceleration that could influence Fed policy decisions. Strong services data combined with resilient employment could reduce urgency for aggressive December accommodation, while weakness could reinforce dovish expectations and raise concerns about economic momentum entering 2026.

Core PCE: Fed's Final Inflation Checkpoint

Friday's Core PCE Price Index at 10:00am represents the Federal Reserve's preferred inflation measure and serves as a critical data point just two weeks before the December policy meeting. Both month-over-month and year-over-year readings will be analyzed for evidence that inflation is sustainably returning to the Fed's 2% target or if concerning price pressures remain that could complicate policy decisions. The report comes after a week of comprehensive economic data and Powell's Monday speech, creating potential for the PCE reading to either validate or contradict the narrative established earlier in the week. Energy prices, housing costs, and services inflation components will be particularly important given their outsized influence on overall price trends. The timing of this release so close to the December meeting means any significant deviation from expectations could trigger substantial volatility in rate-sensitive sectors and influence the dollar's trajectory. Markets will be attempting to balance inflation progress against growth concerns and employment trends to determine the appropriate policy path, with the PCE data potentially serving as the decisive factor in December rate cut expectations.

Best of luck this week and don't forget to check out my daily options article.

On the date of publication, Gavin McMaster did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. This article was originally published on Barchart.com