06:49 AM EDT, 04/22/2024 (MT Newswires) -- US equity investors will focus mainly on mega-cap quarterly earnings and the Federal Reserve's preferred inflation gauge this week as crude oil and gold signaled early Monday that geopolitical risk is receding.

* Investors will watch out for core personal consumption expenditures or PCE deflators on Friday, looking for a repeat of the strength in the core Consumer Price Index for March, according to a note from Daiwa Capital. Hot CPI contributed strongly to pushing out this year's bets for Fed interest-rate cuts.

* The first estimate of Q1 gross domestic product on Thursday will probably show "once again" above-potential growth due to ongoing resilience in household consumption, the Daiwa note said.

* Following Fed Chair Jerome Powell's comments that returning inflation sustainably to the 2% target will likely take longer than anticipated due to relatively strong data, government bond yields jumped and put equity markets under pressure last week.

* Technology was the worst-performing sector last week, led by mega-caps. Tesla (TSLA), Meta Platforms ( META ) , Microsoft ( MSFT ) , and Alphabet (GOOG, GOOGL) will report quarterly results this week.

* The US 10-year Treasury yield jumped 4.1 basis points to 4.66%, and the two-year advanced 4.1 basis points to just under 5% as of early Monday, extending gains from last week due to a delay in the timing of rate cuts while also absorbing an escalation in the Middle East of a conflict between Israel and Iran.

* The probability of a rate cut in May is 2%, according to the CME Group's FedWatch Tool early Monday. The likelihood for June is 19%, and the chance for the easing to begin in July is 37%. The highest probability of a cut in this Presidential election year is 45% in September. At the beginning of 2024, the market was pricing around six cuts.

* West Texas Intermediate crude oil fell 0.5%, and gold slumped 1.8% early Monday, retreating from highs seen last week following Israel's military retaliation against Iran.