A trader works on the floor of the New York Stock Exchange (NYSE) on January 5, 2023.
Andrew Kelly | Reuters
Stock futures rose in Sunday night trading after the major averages staged their first major rally of the new trading year.
Futures linked to the Dow Jones Industrial Average gained 37 points, or 0.11%, while S&P 500 and Nasdaq 100 futures gained 0.16% and 0.25%, respectively.
The overnight moves followed Friday’s first major market rally of 2023. The Dow rose 700 points, or 2.13%, while the S&P 500 and Nasdaq Composite gained 2.28% and 2.56%, respectively, after the Jobs report from December signaled that inflation could ease.
Non-farm payrolls were slightly higher than expected, but wage growth was slower than expected. This, coupled with data showing a contraction in the services sector, has boosted hopes that the central bank’s rate hikes will hit target.
According to Rick Rieder, BlackRock’s chief investment officer of global fixed income, Friday’s pay report and news of layoffs across all sectors suggest the job market is softening, but the economy may still have busier work to do.
“We believe moderation in employment conditions will continue, as parts of today’s report show, but we believe labor demand in the service sector will continue for a while,” he said in a note on Friday.
All major moving averages ended Friday’s session with weekly gains, with the Dow and S&P posting their best weeks since November. The Dow and S&P posted their best day since November 30, while the Nasdaq ended its best session since December 29 on Friday.
Monday starts a big week for economic data. The December CPI report will be released on Thursday, followed by the major banks’ earnings on Friday. In the near term, the New York Fed’s survey of consumer expectations will be released alongside consumer credit data on Monday. Wall Street is also set to hear commentary from Atlanta Fed President Raphael Bostic.
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