US stock futures advanced Friday morning as investors continue to ponder the Federal Reserve’s next policy move.
Contracts on the S&P 500 pointed to a higher open to build on Thursday’s gains and further shed volatility from earlier this week. Still, as of Thursday’s close, the S&P 500 was on track to post a weekly loss that would end a three-week winning streak if levels hold through Friday’s close.
Fresh comments from Fed officials remained in focus as another group of speakers offered mixed comments on the central bank’s future policy path. St. Louis Fed President James Bullard said Thursday he wants the Fed to hit between 3% and 3.25% on the fed funds rate in the second half of this year, suggesting more aggressive frontloaded rate hikes in the near future implies. Expression. Bullard was the only dissenter at the Fed’s March meeting, calling for a larger rate hike of 50 basis points versus the 25 basis point hike that ultimately took place.
While Bullard is now a longer-term hawk seeking greater Fed action to curb inflation, comments earlier this week suggested other central bankers are also warming to the idea of monetary tightening. Fed Governor Lael Brainard said the Federal Open Market Committee (FOMC) “stands ready to take stronger action” if inflation readings remain high and warrant such moves. And in Fed minutes released on Wednesday afternoon, the central bank revealed that “many participants … would have preferred a 50 basis point rate hike” and also indicated that the Fed is preparing to announce the start of its balance sheet soon. leaf expiry process.
However, other Fed officials offered a more measured approach to raising rates. In a comment on Thursday, Atlanta Fed President Raphael Bostic said it would be “appropriate” to move the reference rate “closer to a neutral position,” suggesting a somewhat less hasty series of rate hikes. Meanwhile, Chicago Fed President Charles Evans suggested the Fed would be able to “go neutral, look around and realize we’re not necessarily that far from where we need to be.” .
The story goes on
Taken together, the confluence of comments helped stocks, at least temporarily, break their latest bout of volatility from earlier this week and kept government bond yields more resilient after a steep march higher. The benchmark 10-year yield was around 2.6%, the highest since 2019.
“The market has actually had a lot of information to digest – a lot of hawkish information from the Fed over the past few days. We were in a sell out mode. And I think [Thursday] we’ve finally had a chance to take a breather and recognize that there are some actual positive things happening, particularly in the stock markets,” said Kevin Nicholson, chief investment officer of global fixed income at RiverFront Investment Group, Yahoo Finance Live said on Thursday. “We still expect the earnings season to be better than expected… We also believe that you will be supported by a strong labor market. “From that perspective, the economy is in great shape.”
“We expect equity markets to recover,” he added. “And we actually expect them to rebound to their highs of 4,800 in the few months, especially as they get more clarity from the Fed. As we all know, equity markets don’t like uncertainty.”
—
7:40 am ET Friday: Stock futures are higher, adding to Thursday’s gains
Here’s where the markets traded on Friday morning:
S&P 500 Futures (ES=F): +14 points (+0.31%) to 4,510.25
Dow Futures (YM=F): +130 points (+0.38%) to 34,620.00
Nasdaq Futures (NQ=F): +44.25 points (+0.3%) to 14,580.25
raw (CL=F): +$0.03 (+0.03%) to $96.06 a barrel
Gold (GC=F): -$3.30 (-0.17%) to $1,934.50 per ounce
10-year government bonds (^TNX): +1.6 basis points for a yield of 2.67%
—
6:14 p.m. ET: Thursday: Stock futures are drifting sideways
Here are the major index futures trading Thursday night as the night session began:
S&P 500 Futures (ES=F): +2.25 points (+0.05%) to 4,498.50
Dow futures (YM=F): +12 points (+0.03%) to 34,502.00
Nasdaq futures (NQ=F): +13 points (+0.09%) to 14,549.00
NEW YORK, NEW YORK – APRIL 1: Traders work on the floor of the New York Stock Exchange during afternoon trading on April 1, 2022 in New York City. US stocks closed higher on the first day of trading in the second quarter of 2022 after the Labor Department released a jobs report that showed a rise well above pre-pandemic trends. (Photo by Michael M. Santiago/Getty Images)
—
Emily McCormick is a reporter for Yahoo Finance. Follow her on Twitter.
Read the latest financial and business news from Yahoo Finance
Follow Yahoo Finance on Twitter, Instagram, youtube, Facebook, flipboardand LinkedIn