July 16, 2022
  • July 16, 2022

US Equity Futures Stable With S&P 500 At Record High

By on June 13, 2021 0

Traders on the floor of the New York Stock Exchange.

Source: NYSE

US equity futures were flat in overnight trading on Sunday as investors digested the all-time high of the S&P 500 ahead of a week with a key Federal Reserve meeting.

Dow futures rose 23 points. S&P 500 futures were flat and Nasdaq 100 futures added 0.1%.

The two-day Fed policy meeting is likely to dominate investor behavior this week. Even if the central bank is not expected to take any action, its forecasts for interest rates, inflation and the economy could shake the markets.

Fed Chairman Jerome Powell spoke to the press after the central bank released its statement at 2 p.m. ET on Wednesday. It should affirm the Fed’s commitment to a policy of ease. However, concerns about inflation and how the Fed might react are likely to influence the direction of the market, particularly after a higher than expected consumer inflation reading for May was released. last Thursday.

“In light of recent outsized inflation reports, this week’s Federal Reserve meeting will be reviewed for any telltale signs that the Fed’s timetable to raise funds rate or cut QE is advanced,” Jim Paulsen, chief investment strategist at the Leuthold Group, told CNBC.

“Any evidence to suggest that monetary tightening is moving forward is likely to cause volatility in the stock market,” added Paulsen.

US stocks finished last week with a S&P 500 closing record and the start of a return rotation in growth names.

Last week, the 30-stock Dow Jones Industrial Average fell 0.8%, but the S&P 500 rose 0.4%, for its third consecutive positive week. The Nasdaq Composite outperformed with a gain of nearly 1.9%, recording its fourth consecutive winning week as tech trading returned to favor.

“Because the S&P 500 Index hit a new record last week, investors will be watching to see if it signals even higher levels in the near term,” said Paulsen.

Investors are giving growth stocks another chance as bond yields fall. The 10-year Treasury fell below 1.43% on Friday, a three-month low. Ark Innovation of Cathie Wood, an ETF that focuses on disruptive technologies, returned around 6% last week.

The meme stocks also gained attention last week. AMC Entertainment, Clover Health Investments, GameStop and more experienced volatile trading as the group continued to gain the attention of social media investors on Reddit.

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– with reporting from CNBC’s Patti Domm.

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