Market Watch: Dow futures contract increased by 0.2%, S&P 500 futures rose by 0.2%, and Nasdaq 100 futures rose by 0.4%.
Stock futures rise amid central bank meetings, tech company earnings, Apple’s AI integration, and European corporate results season.
Federal Reserve’s policy meeting
The Federal Reserve, Bank of England, and Bank of Japan are set to hold policy meetings this week. The Fed is expected to maintain its benchmark overnight interest rate in the current range, but markets are expecting a September rate cut.
The Bank of Japan’s policy setting meeting is expected to raise speculation about a rate hike, while the Bank of England is expected to deliver its first rate cut since 2020.
Apple AI
Apple is taking longer than expected to incorporate its AI features into its iPhone and iPad devices, and they will not be included in an initial software update, according to a Bloomberg report.
The company’s AI plans will miss the initial September iOS 18 and iPadOS 18 releases but should be included with the October updates.
Heineken earnings
Heineken shares slumped 7% after missing half-year estimates and writing down its 40% stake in China Resources Beer.
However, Heineken raised its full-year profit guidance, expecting 4% to 8% organic operating profit growth in 2024. Philips’ stock rose 10% after beating expectations, while Pearson’s stock fell 3.5% after a drop in pretax profit.
Economic Calendar
- 10:30Â AMÂ ETÂ Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Dallas Fed Manufacturing Index for July
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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.