Market Watch: Dow futures contract remained largely unchanged, while Nasdaq 100 futures added 31 points or 0.1%, and S&P 500 futures increased by 3 points or 0.1%.
Stock futures remained flat after a Wall Street rally, bringing the S&P 500 and Nasdaq Composite to record-high levels. Investors will focus on monthly retail sales figures and Tesla’s legal battle over Elon Musk’s pay package.
Retail sales data
US consumer spending is expected to increase by 0.3% in May, indicating resilience in the economy. Despite inflation and interest rate hikes, sales have remained strong due to a strong labor market. The data could influence the Federal Reserve’s approach to interest rate reductions later this year, as Philadelphia Fed President Patrick Harker supports a 25-basis point cut in 2024.
Musk Pay Deal Lawsuit
Tesla is battling for legal recognition of CEO Elon Musk’s $56 billion pay package after shareholders voted in favor. Delaware judge Kathaleen McCormick previously ruled the pay unfathomable, but 77% of shareholder votes supported the deal and a plan to reincorporate Tesla in Texas. Tesla attorneys argue the decision impacts McCormick’s previous ruling.
Apple has ended its buy now, pay later
Apple has ended its “buy now, pay later” (BNPL) service in the U.S., a move that allowed users to purchase items in installments. The move was seen as a move into the financial services space dominated by Klarna and Affirm. Apple now focuses on providing installment loans through third-party credit, debit cards, and lenders.
Economic Calendar
- 8:30Â Retail Sales
- 9:15Â Industrial Production
- 10:00Â Business Inventories
- 10:00Â Fed’s Barkin Speech
- 11:40 Fed’s Collins Speech
- 1:00 PM Fed’s Logan Speech
- 1:00 PMÂ Results of $13B, 20-Year Bond Auction
- 1:00 PM Fed’s Musalem Speech
- 2:00 PM Fed’s Goolsbee Speech
- 4:00 PMÂ Treasury International Capital
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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.