Fed Week The Fed meets this week and will announce a decision on interest rates. Spoiler alert: essentially no one thinks a rate cut is likely. Meanwhile, it's another peak week for corporate earnings. Companies have been weighing-in about how tariffs will impact their individual businesses. Last week, the Dow Jones Industrial Average and the S&P 500 both gained 3.0% while the Nasdaq rose 3.4%. All three indices are still negative for the year. So far in 2025, the Dow and the S&P 500 are down 3%, and the Nasdaq has lost 7%. The earnings calendar this week includes Ford, Palantir Technologies, ON Semiconductor, Tyson Foods, Mattel, and Clorox on Monday; Marriott International and Super Micro Computer on Tuesday; Walt Disney, Uber, Door Dash, and Novo Nordisk on Wednesday; and Anheuser-Busch, Warner Bros. Discover, and Cloudflare on Thursday. So far, 65% of S&P 500 companies have reported and earnings are up 13% from the prior-year quarter. That is far above the consensus that called for EPS growth of about 3%-8% and follows 17% growth in 4Q24 EPS and 9% growth in 3Q24, according to LSEG. For the current quarter, Healthcare is the leading sector, with earnings up 45%, and Energy is the bottom, down 18%. On the economic calendar, the big event is the Fed's rate decision comes on Wednesday. Odds are only at 3% for a rate cut, according to the CME FedWatch rate tool. In other economic news, the ISM Services Index will be reported on Monday and the U.S. Trade Deficit will be updated on Tuesday. The Economic Call of the Week from Argus' Chief Economist Chief Graja is the ISM Services Index. Chris expects the index for April to remain above 50, indicating continuing expansion, and offered the following thoughts. 'This indicator has massive importance because it is one of the few that focuses on the dominant sector of the U.S. economy. The 'steady Eddie' services category represents a massive 47% of GDP and may be an important line of defense against further GDP contraction as the drag from imports should moderate. Services grew 2.4% in 1Q and contributed 1.1 point of growth that offset the quarterly decline in GDP. ISM Index values above 50 indicate that the services sector is generally expanding. March's reading was 50.8. Our estimate for April is 50.2. Consensus is 50.4.' Turning to other data, the Atlanta Fed GDPNow measure forecasts 1.1% for 2Q. This follows the surprise decline of 0.3% for 1Q GDP printed last week. The Cleveland Fed Inflation Nowcast forecasts a 2.2% rate for CPI in May, which is lower than the April rate and close to the Fed's 2.0% target. Mortgage rates ticked down by 5 basis points (bps) last week, with the average 30-year fixed-rate mortgage now at 6.76%, according to FreddieMac. Gas prices fell a penny to an average of $3.13 per gallon for regular gas. After this week, the Fed's next meeting is on June 18, with odds at 42% for a rate cut (lower than last week's odds), according to the CME FedWatch rate tool. After that, the Fed meets on July 30 and odds for a cut jump to 89%.

Enterprise Products is a North American provider of midstream energy services to producers and consumers of natural gas, NGLs, crude oil, refined products, and petrochemicals. The partnership's assets include over 50,000 miles of natural gas, NGL, refined product, and petrochemical pipelines; 260 million barrels of storage capacity for NGLs, refined products, and crude oil; and 14 billion cubic feet of natural gas storage capacity. The company completed its IPO in July 1998. The company is not a component of the S&P 500 index. Enterprise currently employs about 7.700 people.

Value stocks -- a market segment that includes high-yield stocks -- outperformed growth stocks in 2022 and have taken an early lead in 2025. That's a recent rarity, as for the past decade-plus, the performance record has favored growth. But the rollout of COVID-19 vaccines gave a lift to some of the cyclical companies (energy and regional banks) that had lagged, and value stocks outpaced growth stocks that year. While growth stocks have retaken the lead since 2023, the Federal Reserve continues to keep interest rates high to fend off inflation. This could possibly cap multiple expansion for growth companies in coming quarters. In any event, the value sector is the place to achieve income.

Enterprise Products is a North American provider of midstream energy services to producers and consumers of natural gas, NGLs, crude oil, refined products, and petrochemicals. The partnership's assets include over 50,000 miles of natural gas, NGL, refined product, and petrochemical pipelines; 260 million barrels of storage capacity for NGLs, refined products, and crude oil; and 14 billion cubic feet of natural gas storage capacity. The company completed its IPO in July 1998.