The U.S. stock market seems positioned for a muted start this morning, as investors wrap up another week on Wall Street. Overseas, the international markets have been putting in a constructive session, thanks to positive economic data in China. Closer to home, the S&P 500 Index futures had been trading higher earlier this morning, but are now hovering around the neutral line. News that the United Auto Workers (UAW) union has started to strike may be putting a damper on investor sentiment, and could pressure auto industry stocks today.
In economic news, there are just a few reports scheduled for this morning. Specifically, the industrial production numbers for the month of August will be released. In addition, the University of Michigan’s consumer sentiment survey for September will be published. Earlier in the week, inflation seemed to be the main topic of conversation, as the latest data showed consumer and producer prices remained stubbornly high during the month of August. Investors, while not thrilled, appear willing to look past these elevated readings, given that considerable progress has been made in the fight against inflation over the past several months. However, it remains to be seen if the Federal Open Market Committee (FOMC) will take the recent data in stride when it holds its next policy meeting next week.
On the corporate front, we continue to receive profits reports from the companies that follow non-calendar fiscal years. Yesterday afternoon, Adobe (ADBE) weighed in with its latest quarterly numbers. Investors seem to be having a mixed reaction to the report, as the stock is under some pressure in pre-market trading. Adobe, which makes a wide range of software for media and marketing customers, is a leader in the technology sector. The company has also been making advances in the area of artificial intelligence (AI). As a result, this report could impact many other stocks in the arena.
From a technical perspective, the S&P 500 Index has been trading in choppy fashion lately, as investors seem to be looking for direction. Lately, the broader market has been hovering around its 50-day moving average, located around the 4,480 level. From here, it remains to be seen if the bulls can push stocks higher, or if further consolidation will be needed. Much will depend on the Federal Reserve’s upcoming policy decisions. The economy does seem to be holding up, aided by strong consumer spending. However, it is not clear that further rate hikes can be absorbed without complications. – Adam Rosner
At the time of this article’s writing, the author did not have positions in any of the companies mentioned.
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