US stock futures were near-balance in premarket trading on Monday as investors brace for a busy week of important economic data that could position the Federal Reserve to react more aggressively to rate hike plans.
Futures tied to the Dow Jones Industrial Average, Nasdaq Composite and S&P 500 were mostly flat ahead of the open after all three major benchmarks posted their second straight week of gains on Friday to close at one-month highs. Meanwhile, bond yields continued to rise, with the 10-year US Treasury above 2.5% as of Monday morning.
Investors are starting to price in an increase in rate hikes this year after recent comments from Fed Chair Jerome Powell signaled a 50 basis point hike is on the table as officials look to higher borrowing costs to peg rising inflation to contain Economic data out of Washington this week could further fuel expectations that central bank policymakers could go ahead with a half-point hike.
The all-important March jobs report is the highlight of this week’s economic reports. Tight labor markets heavily influenced the Fed’s decision to tighten monetary policy, with the momentum of the economic recovery suggesting officials that the US economy could weather less accommodating financial conditions. While an improving job market is benefiting US households, widespread job vacancies have created room for significant leverage for workers, driving wage growth higher and further adding to inflationary pressures. The report is likely to show another robust read, according to estimates by Bloomberg economists, with the number of employees expected to rise by 490,000.
“The payroll report could be the biggest yet in this recovery from the pandemic,” FWDBONDS chief economist Christopher Rupkey said in a recent statement. “Fed officials are already pushing for bigger 50 basis point rate hikes at upcoming meetings, and the tightest job market since the 1960s is like pouring gasoline on a fire, with every political official worth their salt burning with desire to raise interest rates up 2% neutral level now.”
The story goes on
Another focus for traders on the economic data front this week is a fresh read of the monthly personal consumption expenditure (PCE) deflator, due out on Thursday. The gauge is another indicator of how fast prices are rising across the country. According to Bloomberg data, consensus economists expect the PCE to rise another 0.6% in February. The core PCE index, which the Fed uses to conduct monetary policy, is also expected to rise when Wednesday’s print release is released. Consensus economists expect core PCE to rise 5.5% in February, compared to a 5.2% rise in January.
The ongoing Russian invasion of Ukraine remains on investors’ radars. US officials rolled back controversial statements by President Joe Biden over the weekend that appeared to call for the ousting of Russian President Vladimir Putin during a speech in Poland.
Foreign Minister Antony Blinken told reporters on a visit to Israel on Sunday that the US is not trying to remove Putin from power.
“As you know and as you hear us say repeatedly, we have no strategy for regime change in Russia or anywhere else,” Blinken said. “In this case, as in every case, it is up to the people of the country concerned. It is up to the Russian people.”
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7:55 am ET: Stock futures flat after indices notched two straight weeks of gains
After nine consecutive earnings sessions, Apple Inc. (AAPL) is poised to end its longest winning streak this year after it was revealed that the iPhone maker will ramp up production of its iPhone SEs by about 20% in the next quarter due to lower consumer electronics demand. will shorten.
Shares of Apple fell as much as 2% in premarket trading on Monday. Apple was trading at about $172.48 per share as of 7:53 a.m. ET.
The tech giant has also reduced orders for its AirPod headphones by more than 10 million units for 2022. AirPods have become the best-selling wireless headphones, helping Apple capture more than 25% of the global market share, according to Bloomberg, which cited research by the company’s Counterpoint.
Meanwhile, an Oscar win for Apple TV’s CODA on Sunday could also be a win for the company in the streaming race.
“If Apple were to win the coveted Best Picture award with CODA, it would catalyze more A+ talent coming to Apple first (or on the top tier) and Cupertino’s content efforts in the years to come with a large increase in paid.” subscribers by a multiple.” Wedbush tech analyst Dan Ives said ahead of the awards ceremony.
HANGZHOU, CHINA – APRIL 24, 2020 — A customer shows a newly purchased phone Se in Hangzhou, east China’s Zhejiang province, April 24, 2020. On the same day, Apple’s new iPhone SE phone was officially launched to the world. – PHOTO BY Costfoto / Barcroft Studios / Future Publishing (Photo credit should read Costfoto/Barcroft Media via Getty Images)
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7:36 am ET: Stock futures flat after indices notched two straight weeks of gains
Here were the key market moves in Monday’s premarket trading:
S&P 500 Futures (ES=F): +1.25 points (+0.03%) to 4,537.75
Dow Futures (YM=F): +22.00 points (+0.06%) to 34,781.00
Nasdaq futures (NQ=F): -12.25 points (-0.08%) to 14,743.50
raw (CL=F): -$5.29 (-4.64%) to $108.61 a barrel
Gold (GC=F): -$24.70 (-1.26%) to $1,929.50 per ounce
10-year government bonds (^TNX): 0.00 bps gives 2.492%
A trader works on the trading floor of the New York Stock Exchange (NYSE) in Manhattan, New York City, U.S. March 7, 2022. REUTERS/Andrew Kelly
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Alexandra Semenova is a reporter for Yahoo Finance. Follow her on Twitter @alexandraandnyc
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