The Vanguard S&P 500 ETF (VOO) staged a strong recovery and moved to its all-time high of $578, helped by strong bank earnings season and economic numbers that pointed to a resilient economy. 

It remains in a bull market after jumping by over 30% from its lowest point in April. This article explores the top catalysts that will drive the VOO ETF this week. 

VOO ETF to react to top corporate earnings

The S&P 500 Index held steady corporate earnings by companies that published their earnings report. Data by companies like Morgan Stanley, Netflix, Goldman Sachs, and JPMorgan showed that their earnings were doing well despite the ongoing earnings season. 

Bank earnings showed that most of them had their strong results, helped by their trading businesses, which benefited from the ongoing volatility of the financial market. Netflix’s earnings jumped because the company was not directly affected by the ongoing trade war.

FactSet data indicate that 12% of companies in the S&P 500 Index have reported their earnings to date. 83% of these companies reported a positive EPS surprise, while the blended earnings growth was approximately 5.6%, exceeding the median estimate of 4.8%. Still, if this is the final number, it will mark the lowest increase since Q4’23. 

More companies will publish their earnings this week. The most notable companies publishing their earnings this week are Verizon, NXP Semiconductor, Coca-Cola, Philip Morris, Texas Instruments, Intuitive Surgical, and Northrop Grumman.

Tesla and Alphabet will be among the largest companies to publish their earnings. The other top VOO ETF constituents will be ServiceNow, GE Vernova, T-Mobile, Intel, and Nasdaq. 

VOO ETF stock chart | Source: TradingView

Jerome Powell statement on interest rates

The other potential catalyst for the VOO ETF stock will be a statement by Jerome Powell on Tuesday this week. His statement will be crucial, as it comes amid Donald Trump’s continued push for interest rate cuts, suggesting that rates should be around 1%.

Trump argues that the high interest rates were costing the economy billions of dollars in terms of interest payments. 

Powell has argued that the Fed should be cautious, citing the rising inflation. Data released last week showed that the headline Consumer Price Index (CPI) rose from 2.4% in May to 2.7% in June, while the core CPI jumped from 2.8% to 2.9%.

Still, there are signs of division inside the Fed, with Christopher Waller and Michele Bowman calling for cuts. Also, there are concerns that Trump will move to fire or curtail Jerome Powell. 

S&P 500 Index to react to trade issues

The other main catalyst for the VOO ETF will be the ongoing trade issues between the US and its top trading partners, like the European Union as the August 1 deadline nears.

According to Bloomberg, European Union envoys will meet this week to finalize their response measures to the United States. That’s because the US has proposed universal tariffs of between 15% and 20% on all goods from the European Union and fewer exceptions.

A prolonged trade conflict between the US and other countries will have a major impact on the S&P 500 Index and other companies. A deal between the US and other countries like the EU, Japan, and South Korea will be bullish for the VOO ETF.

There will be other catalysts for the VOO ETF this week, including the European Central Bank (ECB) decision and top economic numbers like the manufacturing and services PMI numbers.

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