Market Watch: Dow futures contract increased 0.2%, S&P 500 futures rose 0.4%, and Nasdaq 100 futures rose 0.6%.
Wall Street is expected to open higher on Tuesday, with investors anticipating producer prices and Donald Trump’s return to X, as well as institutional investors returning to U.S. stocks.
U.S. PPI
The first leg of the U.S. inflation double bill is scheduled for Tuesday, with July producer price data expected to sway markets before the consumer price index.
The producer price index is expected to rise 0.2% in July, an annual headline rise of 2.3%, and the core figure to rise 0.2% monthly, with an annual rise of 2.7%. Investors will decide whether the Federal Reserve will cut the policy rate in September.
Trump returns to social media platform X
Republican presidential candidate Donald Trump held a discussion with Elon Musk, owner of X, to revive his campaign after a difficult few weeks. The talk was delayed by a cyberattack and marked Trump’s return to X, formerly Twitter, after a three-year hiatus.
Institutional Investors
Bank of America reported that institutional investors contributed significantly to the rebound of Wall Street’s main indices, buying nearly $6 billion of US stocks for the first time in five weeks.
The largest inflows were seen in tech and communication services stocks, marking the 10th largest inflow since 2008.
Economic Calendar
- 06:00 AMÂ NFIB Small Business Optimism Index
- 08:30 AMÂ Producer Price Index – Final Demand
- 01:15 PMÂ Fed’s Bostic Speech
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Recent data indicating a possible cooling in the U.S. economy have alleviated some persistent inflation concerns, fueling hopes that the Federal Reserve will start to bring interest rates down from more than two-decade highs as soon as September. Along with the Dow, the benchmark and tech-heavytouched record marks last week.
The durability of the strength on Wall Street will likely be tested by a fresh batch of corporate results this week, including quarterly returns from artificial intelligence darling Nvidia (see below). Durable goods and consumer sentiment data will also be in focus as markets hunt for more evidence that growth is moderating enough to give the Fed justification for rolling out rate cuts this year.
Recent data indicating a possible cooling in the U.S. economy have alleviated some persistent inflation concerns, fueling hopes that the Federal Reserve will start to bring interest rates down from more than two-decade highs as soon as September. Along with the Dow,
The durability of the strength on Wall Street will likely be tested by a fresh batch of corporate results this week, including quarterly returns from artificial intelligence darling Nvidia (see below). Durable goods and consumer sentiment data will also be in focus as markets hunt for more evidence that growth is moderating enough to give the Fed justification for rolling out rate cuts this year.
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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.