- February 27, 2023
- By: Admin1_blog
- US Market
U.S. equity futures rose Monday, as traders tried to recover some ground following the worst week of the year on Wall Street. Investors also looked ahead to another big week in retail earnings.
Futures tied to Dow Jones Industrial Averages gained 138 points, or 0.4%. S&P 500 futures were up 0.5%, and Nasdaq-100 futures rose 0.6%.
The major averages Friday ended the day lower and posted their biggest weekly declines for 2023. The Dow finished lower by 3%, its fourth down week in a row. The S&P 500 lost 2.7% and the Nasdaq Composite fell 3.3% for the week.
Stocks sank Friday and Treasury yields jumped following a bigger-than-expected increase in the latest reading for personal consumption expenditures, the Federal Reserve’s preferred inflation gauge.
The early 2023 rally seems to be fading as investors absorb the minutes of the latest Fed meeting, which reiterated the central bank’s tough stance on inflation, as well as recent comments from Fed officials cautioning interest rates could rise higher and for longer than anticipated.
“As we head into a seasonally weak period, with bets rising that the Fed may go with a 50bps increase instead of a 25bps in March, though still a minority opinion, the short-term market risk remains to the downside despite three straight weeks of losses,” said Louis Navellier, chairman and founder of growth investing firm Navellier & Associates. “The bears are dusting themselves off after getting sacked in January.”
Concern over tighter monetary policy and persistent inflation have pushed Treasury yields higher. The 2-year rate on Monday hit its highest level since July 2007.
In the week ahead, investors will be looking for clues about how inflation is affecting consumers and businesses amid a handful of economic data reports and corporate earnings. Durable goods orders are due out Monday morning. Consumer confidence and the ISM manufacturing survey are also on deck in the coming week.
In earnings, just 6% of the S&P 500 will report but investors are looking for insight into the consumer with several major retailers, restaurants, some travel and entertainment names as well as food companies set to report. Target, Costco, Lowe’s and Macy’s are some of the big names set to report earnings this week.