Core Viewpoint - HSBC Global Research economist Ryan Wang indicates that there remains a divergence among Federal Reserve officials regarding the future path of interest rate cuts, predicting a target range of 3.5%-3.75% by the end of 2026 [1] Summary by Relevant Categories Interest Rate Predictions - HSBC maintains its previous forecast that the Federal Reserve will implement two more rate cuts of 25 basis points each, one in December of this year and another in March of next year [1] - The target interest rate range is expected to decrease to 3.5%-3.75% [1] Labor Market Considerations - If the labor market conditions worsen, particularly with an increase in unemployment claims, the Federal Reserve may consider an additional rate cut of 25 basis points in October of this year or a larger cut next year [1]

Group 1: Market Performance - The S&P 500 index closed at 5525.21 points, up 4.59% from last week's 5282.70 points, but down 6.06% year-to-date [1] - Out of the 11 sectors covered by the S&P 500, 10 sectors increased this week, compared to only 5 sectors last week [1] - The Information Technology sector was the best-performing sector this week, rising by 7.93%, while it has decreased by 11.92% year-to-date [1] - The Consumer Discretionary sector rose by 7.44% this week, but it has fallen by 13.72% year-to-date, making it the worst-performing sector [1] - The Communication Services sector increased by 6.36%, with a year-to-date decline of 6.12% [1] Group 2: Economic Data - The April manufacturing PMI composite preview report was 50.7, above the expected 50.2, while the services index was 51.4, below the expected 52.5 and down from 54.4 previously [2] - March new home sales were at an annual rate of 724,000, exceeding the expectation of 682,000, and up from 674,000 in February [2] - The final consumer confidence index for April was 52.5, down from 57.0 in March, and the annual inflation expectation decreased from 6.7% to 6.5% [2] - Mortgage applications fell by 12.7%, with purchase applications down 6.6% and refinancing applications down 20.9% [2] - The EIA reported an increase of 200,000 barrels in U.S. oil inventories, following a previous increase of 500,000 barrels [2] - The latest weekly unemployment claims report showed 222,000 claims, consistent with expectations, and the total number of people receiving unemployment insurance rose to 1.841 million [2] Group 3: Earnings Reports - The earnings season continues, with 180 stocks (accounting for 35.6% of market capitalization) reporting earnings, of which 75% exceeded expectations and 63% had sales above expectations [2] - Earnings are expected to decline by 3.2% compared to the fourth quarter of 2024 [2]