Wall Street on edge as Iran war drags on; eyes also on Jensen Huang’s message [Weekly outlook for New York and Shanghai stocks]

FOMC scheduled for June 17–18

Close watch on Powell’s inflation message

New York stocks are expected to see heightened volatility this week (June 16–20) depending on how the war between the United States and Iran unfolds. Major catalysts are also on the calendar, including the Federal Reserve’s Federal Open Market Committee (FOMC) meeting and Nvidia’s annual developer event, the GTC conference.

The direction of the New York market is likely to hinge primarily on developments in the U.S.–Iran war. With the conflict lasting longer than expected, tensions across the Middle East appear to be rising further. Attention is on how oil prices respond in the futures market opening at 6 p.m. (local time) on the 15th. If crude prices climb further, inflation concerns would intensify, making it inevitable that the Fed’s first rate cut would be pushed back. On Wall Street, it is widely taken as a given that rates will be left unchanged at the June 17–18 FOMC.

Investors are expected to focus on the “dot plot,” which contains FOMC members’ rate projections, and on Fed Chair Jerome Powell’s press conference. With Brent crude above $100 a barrel, the inflation outlook is of particular interest.

Investors are also closely watching Nvidia’s GTC conference, running June 16–19. Nvidia CEO Jensen Huang will deliver the keynote on the 18th. If Huang strikes a positive tone on the artificial intelligence (AI) market, the market is likely to feel reassured about the AI sector.

Shanghai stocks are expected to trade with volatility as investors watch the release of the loan prime rate (LPR), a key gauge of China’s monetary-policy direction, and the pace of policy implementation after the “Two Sessions.”

Retail sales and fixed-asset investment data for January–February, due on the 16th, are expected to serve as a yardstick for the strength of the early-year recovery. The market is looking for a modest rebound in consumption. At the LPR decision scheduled for the 20th, the People’s Bank of China is likely to keep rates unchanged. Still, the possibility of a signal pointing to additional liquidity support to shore up growth cannot be ruled out.

New York=Park Shin-young, correspondent nyusos@hankyung.com