Stock futures drop ahead of big week of economic data

Traders on the floor of the New York Stock Exchange, March 25, 2022.

Source: NYSE

Stock futures slipped slightly on Sunday evening as investors looked ahead to a string of key economic reports and continued to keep a close eye on the Fed’s planned rate hikes.

Futures related to the Dow Jones Industrial Average were down 58 points, or 0.1%. S&P 500 and Nasdaq 100 futures were down 0.1% each.

The Dow and S&P rose in the previous session to conclude its second week in a row. The Dow gained 153 points, or 0.4%. The S&P 500 advanced 0.5%, erasing more of its losses since Russia’s invasion of Ukraine in late February. Meanwhile, the Nasdaq Composite was down 0.2% but ended the week higher.

The moves came as investors continue to monitor developments in Russia’s war on Ukraine and expectations about the Federal Reserve’s plans to raise interest rates.

“It appears that the skyrocketing commodity prices have taken a rest, and this has given investors the opportunity to return to equities,” said Edward Moya, chief market analyst at Oanda. “Geopolitical risks remain very high and the rally in equities over the past two weeks has been impressive. The US economy is still doing well, but buying every dip in the stock market probably won’t be a stand for most future traders given how optimistic the Fed has turned.”

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Investors continue to watch the Fed closely. Wall Street firms from Goldman Sachs to Bank of America started in half-point increases at future Fed meetings this year after Central Bank President Jerome Powell vowed to be tough on inflation He said rate increases could become more aggressive if necessary.

On Friday, the 10-year benchmark yield Touched a new multi-year high of 2.5% Investors priced in a more aggressive price-raising cycle, which helped lift financial stocks while technology stocks tumbled.

Investors are looking forward to the Job Opportunities and Employment Turnover Survey, or JOLTS, this week. The JOLTS report is one set of employment data that the Federal Reserve is watching closely as it tightens monetary policy. The ADP will also release its own jobs data before the main presentation, the closely watched monthly jobs report, on Friday.

Monday is a light day for earnings reports but several major companies are due to report quarterly results this week, including BioNTech, Micron and Walgreens Boots Alliance.

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