Market Watch: Dow futures contract gained 46 points or 0.1%, S&P 500 futures remained mostly unchanged, and Nasdaq 100 futures edged down by 10 points or 0.1%.
Stock futures weakened due to Federal Reserve interest rate cuts, equities surge, and Richmond Fed President Thomas Barkin stating borrowing costs are restrictive enough to curb inflation.
Thomas Barkin is optimistic
Richmond Fed President Thomas Barkin is optimistic that current interest rates, ranging from 5.25% to 5.50%, will help cool inflation and reduce demand. He believes the economy is not on track to overheat and that the Fed has the necessary support if the economy slows. However, Barkin notes that easing inflation is difficult and may take time.
Walt Disney Earning
Walt Disney is set to release its second-quarter results, following a proxy battle with activist investors. Shares in Disney have gained over 28% in 2024, but remain below their three-year highs.
Stakeholders await Iger’s strategy for Disney’s streaming business, aiming for profitability by year-end. Analysts anticipate subscriber growth, narrowing operating losses, and increased adjusted earnings per share and revenue. Disney’s direct-to-consumer unit is expected to narrow.
Apple is developing an AI chip for data centers
Apple is developing an AI chip for data centers, code-named ACDC, to gain an edge in the rapidly growing AI industry. The project, which began designing its own chips for iPhones over the past decade, comes amid growing speculation over how Apple plans to incorporate AI into its product line-up.
Economic Calendar
- 11:30 Fed’s Kashkari Speech
- 1:00 PM Results of $58B, 3-Year Note Auction
- 3:00 PM Consumer Credit
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MFitch Ratings has downgraded China’s credit rating outlook to “Negative” from “Stable” due to concerns over growing public debt and slowing growth in the world’s second-largest economy. The agency affirmed China’s rating at A+, citing increasing risks to China’s public finance outlook. Concerns over slowing economic growth have grown in recent months, with Fitch expecting gross domestic product growth to fall to 4.5% in 2024.
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U.S. inflation data for February is expected to provide insights into the future direction of Federal Reserve monetary policy. The overall consumer price index (CPI) is expected to match the previous month’s pace of 3.1% annually, with the core CPI expected to slow to 3.7% from 3.9% in January. However, the month-on-month gauge is expected to shed light on price gains momentum.
Fed officials have made cooling inflation the main objective of interest rate hikes, which have brought borrowing costs to over two-decade highs. They suggest cuts may be coming later this year, but need more evidence that price growth is sustainablely easing back down to their 2% annualized target. Analysts at ING believe inflation is likely too hot for comfort.
U.S. inflation data for February is expected to provide insights into the future direction of Federal Reserve monetary policy. The overall consumer price index (CPI) is expected to match the previous month’s pace of 3.1% annually, with the core CPI expected to slow to 3.7% from 3.9% in January. However, the month-on-month gauge is expected to shed light on price gains momentum.
Fed officials have made cooling inflation the main objective of interest rate hikes, which have brought borrowing costs to over two-decade highs. They suggest cuts may be coming later this year, but need more evidence that price growth is sustainablely easing back down to their 2% annualized target. Analysts at ING believe inflation is likely too hot for comfort.