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This week will be key to watch as FOMC minutes on Wednesday and inflation data with the US PCE on Friday could offer investors more clues on the Fed's next move. Currently, markets are forecasting only few chances of a June interest rate hike. But more worrying, markets expect many interest rate cuts in the next 2 years. Should core inflation and the labor market remain so persistently tight, it could be that the market switches to a view where interest rates stay higher for longer.

The US Federal Reserve is expected to proceed with its last interest rate hike Wednesday. Here are the average returns for the S&P 500 one year after last hike, in the past. The biggest hurdle in our view is valuations are now expansive. As a result, it is more of a traders's market, perhaps.

The LinkedIn hiring rate is a measure of hires divided by LinkedIn membership. The US LHR was down 6.5% month over month seasonally adjusted, its biggest 1 month decline since 2020 ! Hiring is now down 30.8% from April 2022 (when declines began), and 27.9% year over year. Source: Guy Berger - Chief Economist at LinkedIn

The main central banks in the world are expected to end 2022 with additional rate increases as they continue to fight against inflation. The US Federal Reserve will meet on Wednesday, followed by the European Central Bank, the BoE, and Switzerland's SNB on Thursday. On Tuesday, US inflation statistics will provide us with new insights into the Fed's strategy. The Fed meeting and the inflation statistics come as a double punch and could determine the direction of US stocks for the remainder of the year and beyond. Lastly, analysts will be closely following earnings from cloud software giants Oracle (Monday) and Adobe (Thursday), expected to be released after the bell.

The Nasdaq 100 is pushing 1% higher in pre-market as markets are encouraged by signs of China easing its restrictions and helping its struggling property sector. Traders are also constructive on markets ahead of PPI being released before market open. It is expected to increase by 0.4% month-over-month for October, the same as last month. Both Walmart and Home Depot are scheduled to release earnings in pre-market. Investors will look for clues on the state of consumer spending and how are the big box retailers' margins holding up amid inflation.