Traders work on the floor of the New York Stock Exchange (NYSE) in New York City, July 20, 2023.
Brendan McDermid | Reuters
U.S. equity futures were little changed Monday after key stock benchmarks reached record highs and investors awaited inflation data slated for release later this week.
Futures tied to the Dow Jones Industrial Average were down 34 points, or 0.1%, while S&P 500 futures dipped 0.08%. Nasdaq-100 futures ticked down 0.03%.
Amazon is joining the 30-stock Dow on Monday, replacing Walgreens Boots Alliance. The Dow’s holdings are weighted according to stock price, not market cap. The addition of the e-commerce giant will increase the index’s exposure to tech and consumer retail.
Stocks are coming into the final week of February on a high note after the major indexes achieved key milestones and registered winning weeks with help from Nvidia’s blockbuster earnings. The blue-chip Dow closed at an all-time high, the S&P at one point in the session broke above 5,100 for the first time, and the tech-heavy Nasdaq Composite touched a 52-week high in Friday’s session.
Investors are now watching whether the AI momentum can last as economic and inflation risks linger. With that in mind, they’re also looking ahead to the monthly personal consumption expenditures price index, the Fed’s favored inflation gauge due out Thursday.
“Nvidia has been the gift that keeps on giving with blockbuster earnings reports driving semis, tech, and the broader market higher this past week. With the market now up over 20% since its Oct 2023 low, we would expect the market to take a breather at some point,” Stephanie Lang, chief investment officer at Homrich Berg, told CNBC. “A hotter than expected PCE report this week could be a data point that could dampen the market enthusiasm.”
“So far stocks have shrugged off the hawkish tone of the Fed as the AI halo has taken center stage, but the market is banking on the Fed’s orchestration of a soft landing and the longer the Fed waits the more risk there is to that happy ending,” she added. “Still the Fed is well aware that they want to avoid a repeat of a stop-and-go tightening of interest rates in the 1970s when they failed to control inflation so they remain patient to make sure they are confident their job is done.”
There’s a raft of economic releases on deck, including January durable orders data on Tuesday and January wholesale inventories on Wednesday.
Elsewhere, corporate earnings are winding down but several high-interest names are reporting in the coming week, which could give investors greater insight into the state of tech and the consumer.
Source Agencies
