Stock futures rose slightly in overnight trading Sunday following a down week for the market as the rally in 2024 took a breather. Futures on the Dow Jones Industrial Average increased by 65 points, while S&P 500 futures and Nasdaq 100 futures both saw a slight uptick of 0.1%. The Dow fell by 2.3% last week, marking its worst weekly performance since March 2023. The S&P 500 also declined nearly 1%, its biggest weekly loss since early January, while the Nasdaq Composite dropped by 0.8%, experiencing its fourth negative week in five.
Despite the overall decline throughout the week, the market ended on a positive note after a stronger-than-expected jobs report was released on Friday. The better-than-expected gain in payrolls provided investors with optimism that a strong economy could continue to support corporate earnings growth, even if it means dealing with higher interest rates for a longer period of time. Bill Adams, chief economist at Comerica Bank, noted that rising jobs and wages, along with payrolls outpacing inflation, are likely to keep Americans spending and drive the economy forward in 2024.
Investors are eagerly awaiting readings for the March consumer and producer price indexes later in the week to gain further insight into the success of the Federal Reserve’s fight against inflation. Economists polled by Dow Jones anticipate the CPI number to increase by 0.3% last month and by 3.5% year over year. Adam Crisafulli, founder of Vital Knowledge, highlighted the importance of the inflation data in demonstrating the progress of the disinflationary process and its impact on the Fed’s current stance on employment gains and inflation concerns.
In addition to inflation concerns, investors are also monitoring rising bond yields and oil prices. The benchmark 10-year Treasury yield saw a significant increase of nearly 20 basis points last week, reaching around 4.4%. Meanwhile, U.S. crude oil prices reached $87 amid geopolitical tensions, adding another element of uncertainty for investors to consider. The combination of these factors, including inflation data and economic indicators, will contribute to the market’s overall performance and direction in the coming days and weeks.
Overall, the market remains volatile as investors navigate through various economic indicators and geopolitical factors influencing stock futures and market performance. The recent rise in bond yields, oil prices, and concerns about inflation have added to the complexity of investment decisions. However, with positive economic data, such as the strong jobs report, providing some relief to investors, there is cautious optimism that the economy will continue to grow and support corporate earnings. Monitoring key data points, such as the consumer and producer price indexes, will offer further clarity on the Fed’s response to inflation and its impact on market trends in the near future.
