The major U.S. stock indexes started the week on a mixed note.
Last Friday’s better-than-expected jobs report suggested that recessionary fears may be overblown, and provided the Federal Reserve more wiggle room to continue raising rates.
This Wednesday, we’ll get the July figures for the Consumer Price Index (CPI), which will serve as a report card on how the lead bank is faring in its fight against inflation. Current expectations are that the year-over-year increase will come in around 8.7%, down slightly from June’s jump of 9.1%. However, the so-called core figure, which excludes volatile food and energy costs, appears likely to show a slight increase versus June’s tally of 5.9%. Thursday will bring the latest figures for initial and continuing jobless claims, as well as the Producer Price Index, where the consensus is calling for a decline in July versus June. Any upside surprises to the inflation numbers will likely mean the Fed will have to maintain its aggressive stance at the next meeting in September, which would probably push stocks lower.
Otherwise, second-quarter earnings season is getting close to wrapping up. And while there are a number of companies reporting this week, the upcoming releases are not likely to prompt any major moves from traders. Instead, as in recent months, central bank policy, will likely continue to hold sway in the near future.
Summing up Monday’s results, the Dow Jones Industrial Average closed up 29 points, while the broadly diversified S&P 500 (which has racked up three straight winning weeks) slipped five points. Meanwhile, the tech-focused NASDAQ composite shed 13 points. In terms of sector performance, most were in the green, led by materials and energy shares, which gained about half a percentage point on the day. In the negative column, technology shares fared the worst, losing about 0.9% of market value.
As we look toward a new day, U.S. stock futures are pointing to a slightly negative open. Elsewhere, Asian markets were mixed overnight, while stocks in Europe are mostly trading in the red. Meanwhile, oil futures are up about 1.3%, to around $91.90 a barrel.
– Mario Ferro
At the time of this article’s writing, the author did not have positions in any of the companies mentioned.
