This comes after Federal Reserve Chairman Jerome Powell said Thursday that the economy is showing enough strength that there is no “rush” to further rate cuts just yet. , US stocks could start negative on Friday.
Futures on all three major indexes fell as investors processed key inflation and economic data released this week.
“The economy is not sending a signal that there is a need to rush to cut rates. The strength of the economy we are seeing now allows us to approach our decisions with caution,” Powell said, maintaining a wait-and-see attitude. Approach for now.
For now, the post-election stock market rally appears to be slowing as investors hedge their bets while locking in profits.
In pre-market trading on Friday, the SPDR S&P 500 ETF Trust spy Invesco QQQ ETF down 0.53% to $590.22 QQQ The stock fell 0.80% to $504.63, according to data from Benzinga Pro.
Clues from the last session:
U.S. stocks ended in the red on Thursday, with the tech-heavy Nasdaq the biggest decliner.
Crude oil prices fell below the $70 level and fell further on Friday due to concerns about a drop in demand due to the slowing Chinese economy.
U.S. Treasury yields rose slightly again as investors digested Powell’s comments on the economy and the prospect of a rate cut in the near future.
In terms of economic indicators, the number of new jobless claims in the United States for the week ending November 9 was 217,000, down 4,000 from the previous week, compared to market expectations of 223,000.
US producer prices in October rose 0.2% from the previous month, and the revised price for September rose 0.1%, in line with market expectations.
Most sectors of the S&P 500 ended in negative territory, with consumer staples, industrials and health care stocks posting the biggest losses on Thursday.
However, IT and energy stocks bucked the broader market trend and closed higher.
Insights from analysts:
ING analyst Francesco Pezzor said Powell’s relatively hawkish tone has made investors cautious in the market.
This could lead to a correction in the dollar and is “testing the limits” of longs, Pesole said, adding that traders need to be cautious for now.
“Chairman Powell appears to be more focused on the strength of the economy and how it will allow the central bank to be ‘cautious’ in its policy decisions going forward.”
CME Group’s FedWatch tool reflects a decline in sentiment for another rate cut next month, with the probability falling from 72.2% to 62.1%.
Investors will also be watching retail sales data, which is expected to be released later today.
But Sonu Varghese, global macro strategist at Carson Group, downplayed concerns about an inflation rebound, saying there was a “disinflationary trend” and that price increases were “likely to be contained.”
On the equity side, Varghese maintained his bullish outlook.
“Overall, the economic strengths clearly outweigh the weaknesses, and we believe opportunities are more likely to materialize than threats. This balance favors continued strength in equities. That’s why we remain overweight in equities, especially US equities.” ”
See also: Futures Trading Methods
Future economic data
Friday’s key economic updates include:
The import price index will be released at 8:30 a.m. ET. Retail sales data will be released at 8:30 a.m. ET
Featured stocks:
tesla company TSLA All eyes will be on stocks today following reports that President-elect Donald Trump is likely to end the $7,500 tax credit. Tesla stock fell 5.8% on Thursday. Taiwan Semiconductor Manufacturing Co., Ltd. TSM The stock rose 0.4% in pre-market trading after the U.S. government decided to provide $6.6 billion in subsidies to chipmakers under the CHIPS Act. Domino’s Pizza Co., Ltd. DPZ Shares rose more than 7% in premarket trading after Warren Buffett’s Berkshire Hathaway acquired a small stake in the company. Pfizer Inc. PFEModerna Inc. mRNAand Novavax Inc. NVAX Stocks fell after President Trump nominated Robert F. Kennedy Jr. as Secretary of Health and Human Services. Palantir Technologies Co., Ltd. PLTR announced its listing from the New York Stock Exchange to the NASDAQ on November 26th. Investors are awaiting Alibaba Group Holding Limited’s financial results. BabaSpectrum Brands Holdings, Inc. SPBRLX Technology Inc. RLX today.
Commodities, bonds and global stock markets:
Crude oil futures fell in early New York trading, dropping 1.11% to around $67.94 per barrel.
The yield on 10-year government bonds rose slightly to about 4.43%.
Most major Asian markets were mixed on Friday, while European markets edged higher in early trading.
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