- The VOO stock price has risen in the past few days amid the US-Iran ceasefire.
- Donald Trump has announced a major blockade of the Strait of Hormuz.
- The earnings season will start on Monday, with Goldman Sachs being the first to release its numbers.
The Vanguard S&P 500 ETF (VOO) will be highly volatile this week as the earnings season kicks off and President Donald Trump’s blockade of the Strait of Hormuz starts. It has jumped to $625, its highest point since March 10.
VOO Stock Price to React to Q1 Earnings
The VOO ETF, which has raked in over $30 billion this year, will react to the upcoming corporate earnings, which will provide more color on how American companies performed in a war-ravaged quarter.
A FactSet report shows that the average estimate among Wall Street analysts is that companies grew by 12% in the first quarter, the sixth consecutive quarter of double-digit earnings growth.
The same report noted that the actual number has been 7% above the estimate, suggesting earnings growth may come in at 19%, the highest level in years.
Goldman Sachs will be the first major company to publish its financial results on Monday, with analysts expecting strong numbers, helped by the soaring deal-making and trading. It will be followed by companies such as JPMorgan, Citigroup, Wells Fargo, Johnson & Johnson, and BlackRock the following day.
Other S&P 500 Index constituents that will publish their financial results this week are Bank of America, Morgan Stanley, PNC, Netflix, and Abbott.
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Donald Trump’s Oil Blockade to Impact the Stock Market
The other key catalyst for VOO’s stock price is President Donald Trump’s announcement that he would impose a major blockade on ships entering and leaving the Strait of Hormuz following the failure of talks in the Middle East. Data shows that crude oil prices soared on Monday as Iran has vowed to retaliate.
At the same time, there are concerns that the war will restart soon as talks have largely failed. Also, Israel has always opposed the ceasefire, with Netanyahu saying that his country will advance its objectives, which are decapitating Iran now that regime change has failed.
Therefore, there is a likelihood that the stock market will come on edge as the war will lead to higher inflation. A report released on Friday revealed that the headline Consumer Price Index (CPI) jumped to 3.3% in March this year.
S&P 500 Index to React to US PPI Data
The VOO ETD will also react to the upcoming US Producer Price Index (PPI), which will come out on Tuesday. This is an important report that shows how companies are being affected by the soaring costs.
Data show that the average estimate is that the headline PPI will come in at 4.1%, well above the previous 3.4% and the Federal Reserve’s target of 2.0%. The core PPI is expected to come in at 3.7%from the previous 3.9%.
The ETF will also react to notable announcements from key Federal Reserve officials, including Austan Goolsbee, Michelle Bowman, and Stephen Miran. Also, the Fed will publish the latest Beige Book.
VOO Share Price Technical Analysis
The three-day chart shows that the VOO stock price has rebounded and is now hovering near its all-time high. It has already moved above the 50-day moving average, confirming the bullish outlook.
The Relative Strength Index (RSI) has moved above the neutral 50 level, a sign that the uptrend is gaining momentum.
Therefore, the ETF will likely pull back a bit amid energy concerns and then rebound later this week. Chances are it will jump and cross the all-time high in the near term, as it does whenever there is a major black swan event.
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