A day after the Federal Reserve's minutes indicated the central bank likely will continue its interest rate hiking path, credit card issuer American Express Co. ( AXP - Get Report) will report earnings. One question worth asking, of course, is whether or not interest rate increases will propel revenue at AmEx? Perhaps more importantly, revenue at American Express revenue could tell us something about discretionary spending. We had strong revenue from both Alcoa Corp. ( AA - Get Report) and Steel Dynamics Inc.'s ( STLD - Get Report) , potentially signifying healthy demand for manufactured goods. What can we learn from AmEx?
Federal Reserve minutes released Wednesday showed that Fed officials believe the best way to encourage a steady U.S. economy is to raise interest rates gradually, with the central bank saying it sees a strong labor market and the possibility of rising inflation. More rate hikes would put a damper on demand and could be a headwind to a stock like American Express. That headwind, however, probably won't show up just yet in the earnings print that will come out Thursday.
TheStreet's Jim Cramer said he thinks the Federal Reserve is moving too quickly. "The 0.1% CPI this week, that's the inflationary pressures taking care of themselves. We don't [need] the Fed to [raise rates]," Cramer told the audience at his teach-in event Saturday.
Jim Cramer will host a conference call for Action Alerts Plus investors on Thursday, where he will give important insights on the stocks in the AAP portfolio. Whether or not you're a member, you won't want to miss insight from one of the most fascinating minds in investing.
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