The GDPNow model from the Atlanta Fed estimates the second quarter of 2025 real GDP growth at 2.4%. This figure remains the same from July 17 after rounding. Following the release of US Census Bureau housing starts data, the nowcast of second-quarter real residential investment growth has decreased to -7.0% from -6.4%.<\/p>\n
The next GDPNow update is set for July 25. The advance estimate for Q2 2025 real GDP will be available on July 30 at 8:30 a.m. ET, aligning with the US Federal Reserve’s rate decision. The same week will feature the US jobs report’s release and the initiation of new tariffs.<\/p>\n
Several companies, including Boeing, Procter & Gamble, UnitedHealth Group, Starbucks, Visa, ARM Holdings, and Ford, are anticipated to release earnings reports that week. Other companies such as Meta Platforms, Microsoft, Bristol-Myers Squibb, Mastercard, Amazon, Apple, MicroStrategy, Chevron, and ExxonMobil are also expected to disclose their earnings.<\/p>\n
With the estimate for second-quarter growth holding at a steady 2.4 percent, we anticipate a period of heightened market sensitivity. The slight decrease in the nowcast for real residential investment growth hints at underlying weakness, creating a complex picture for traders. Upcoming economic reports will be critical in determining the market’s next major move.<\/p>\n
Our focus is intensely on the end of the month when the advance GDP estimate coincides with the central bank’s rate decision. Current market pricing, reflected in the CME FedWatch Tool, shows a greater than 90% probability of rates remaining unchanged, putting more weight on the forward guidance. Any deviation from this expectation will introduce significant volatility into interest rate-sensitive derivatives.<\/p>\n
The upcoming US jobs report will be scrutinized for any signs of labor market cooling, which could influence future policy. Recently, the Volatility Index (VIX) has been hovering in a relatively low range between 12 and 14, suggesting the market may be underpricing the risk of this confluence of events. We believe this presents an opportunity to buy volatility through options before it is fully priced in.<\/p>\n
The wave of corporate earnings reports will provide a granular view of the economy, from consumer spending seen at firms like Mastercard to enterprise demand at Meta. Forward-looking guidance from these bellwether firms will be more influential than their backward-looking results. We will be watching for any revisions to outlooks that could signal a broader economic shift.<\/p>\n
The implementation of new tariffs adds another layer of uncertainty, potentially impacting inflation and corporate costs for companies like Chevron. Given the packed event calendar, we are considering strategies like straddles or strangles on major indices to profit from a large price move in either direction. This approach allows us to capitalize on the expected increase in volatility without betting on a specific market direction.<\/p>\n
Create your live VT Markets account<\/a>\u00a0and\u00a0start trading<\/a>\u00a0now. <\/b><\/p>\n","protected":false},"excerpt":{"rendered":" Atlanta Fed\u2019s GDPNow holds Q2 growth at 2.4%; residential investment outlook worsens; key earnings ahead.<\/p>\n","protected":false},"author":62,"featured_media":17028,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[59],"tags":[],"class_list":["post-26740","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-live-updates"],"acf":{"acf_article_selection_author":null},"aioseo_notices":[],"aioseo_head":"\n\t\t\n\t\n\t\n\t\n\t\n\n\t\t