Traders on the floor of the New York Stock Exchange on August 4, 2022.
Source: NYSE
Stock futures rose slightly in overnight trading on Sunday after a week of declines as the 2024 rally took a breather.
Futures on the Dow Jones Industrial Average climbed 65 points. S&P 500 futures and Nasdaq 100 futures each rose 0.1%.
The 30-stock Dow fell 2.3% last week, posting its worst weekly performance in March 2023. The S&P 500 fell nearly 1% in the period, its biggest weekly loss since early January. The tech-heavy Nasdaq Composite fell 0.8%, suffering its fourth negative week in five.
However, the market ended last week on a positive note following stronger-than-expected jobs reports on Friday. The surprise jump in employment gave investors hope that a strong economy could continue to support corporate earnings growth, even if it means higher interest rates in the longer term.
“Jobs and wages are rising solidly and total payrolls are outpacing inflation, which will sustain Americans' spending in 2024 and drive the economy forward,” said Bill Adams, chief economist at Comerica Bank.
To gain even more clarity on how successful the Federal Reserve's fight against inflation has been, investors are eagerly awaiting the results of the March consumer and producer price indexes later this week.
Economists polled by Dow Jones expect the CPI number, which will be released Wednesday morning, to rise 0.3% last month and 3.5% year over year.
“The Fed does not appear to be bothered by the robust employment gains… However, inflation is a bigger concern and it is imperative that March price data (CPI, PPI, PCE) show that the disinflationary process is back on track is coming,” Adam Crisafulli, founder of Vital Wissen, said in a note.
Investors are also grappling with rising bond yields and oil prices. The benchmark 10-year Treasury yield rose nearly 20 basis points to about 4.4% last week. Due to geopolitical tensions, the US crude oil price reached the $87 mark.
Comments are closed.