The S&P 500 will try to close out its worst September decline since 2008 in the green Friday, with stocks closely-tracking U.S. Treasury yields ahead of key inflation data.
U.S. equity futures edged higher Friday as investors looked to close out the worst month for the S&P 500 since 2008 on a modestly firmer note, thanks in part to a pullback in Treasury yields and a softer U.S. dollar.
The Friday gains, however, follow fresh 2022 lows for the Nasdaq last night, as extended declines for both Tesla TSLA and Apple AAPL pulled the tech benchmark sharply lower amid what appeared to be end-of quarter repositioning my major investment funds.
The S&P 500, meanwhile, is down just under 8% for the month after hitting a November 2020 low by the close of trading on Thursday.
Few positive catalysts look set to drive stocks through the end of the Friday session, and with the Vix index, Wall Street’s so-called ‘fear gauge’ trading 4.25% higher and above the 31 point level, traders are braced for another whipsaw session that is likely to closely track movements in Treasury bond yields.
Benchmark 2-year notes were pegged at 4.15% in early New York dealing, pulled lower by a softer U.S. dollar, while 10-year notes fell 5 basis points to 3.7%.
Solid gains for the pound, which had its best day on foreign exchange markets in more two years at the Bank of England continues to intervene in government bond markets, added to the dollar’s overnight decline,, although the dollar index was stabilized at 112.498 heading into the start of Friday trading.
Stocks Bounce, Inflation, Nike, Micron And Boeing In Focus – Five Things To Know
Inflation prospects, as well as planned central bank rate hikes, remain the market’s central concern, however, underscored by a faster-than-expected September reading for consumer prices in Europe, which rose to a record high of 10%, and jobs data from the U.S. yesterday showing weekly unemployment claims fell to the lowest levels in five months.
The Federal Reserve’s preferred inflation gauge, the core PCE Price Index, is expected to show another move higher for the month of August as policymakers continue to press ahead with their plans to raise interest rates over the coming months.
The core PCE reading is likely to mirror that faster-than-expected August reading for headline CPI, which sped to 8.3%, when the data is released by the Bureau of Economic Analysis at 8:30 am Eastern time. Analysts are looking for a year-on-year reading of 4.7% and a big monthly jump of 0.5%.
European stocks were higher on the session, rising 0.68% in mid-day Frankfurt trading, although the benchmark is on pace for its third consecutive quarterly decline, with a 0.37% gain for the FTSE 100 in London.
On Wall Street, futures contracts tied to the S&P 500 are indicating a 10 point opening bell gain, while linked to the Dow Jones Industrial Average are priced for a 35 point slump. Futures tied to the tech-focused Nasdaq are indicating a 25 point move to the upside
Nike (NKE) – Get Nike Inc. Report shares fell sharply lower in pre-market trading after it cautioned that “higher markdowns” will be needed to reduce its bloated global inventory, pressuring profit margins for the world’s biggest sports apparel company.
Micron Technology (MU) – Get Micron Technology Inc. Report shares jumped higher in pre-market trading after a move by the Japanese government to subsidize its chipmaking operations in Hiroshima offset a muted near-term profit outlook.
Boeing (BA) – Get The Boeing Company Report shares were holding onto modest gains following multiple reports that suggest the planemaker may not meet an end-of-year target for recertification of the 737 MAX.
