Futures edge higher ahead of revised 2023 inflation data
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[February 09, 2024] (Reuters)
- U.S. stock index futures edged higher on Friday, a day after the
benchmark S&P 500 breached the 5,000-mark for the first time, while
investors looked ahead to inflation data for hints on the timing of the
Federal Reserve's first interest-rate cut.
The S&P 500 and the blue-chip Dow both hit all-time highs on Thursday,
while the tech-heavy Nasdaq closed less than 2% away from its peak as
investors cheered strong earnings, particularly from companies poised to
benefit from the boom in artificial intelligence.
Investors will now focus on the U.S. Bureau of Labor Statistics' revised
inflation figures for 2023, calculated using new seasonal adjustment
factors - statistical weights that aim to reflect how prices behaved
over the year more accurately.
The updated Consumer Price Index data will be released at around 8:30
a.m. (1330 GMT), with new inflation data for January coming next week.
"This is something the Fed are watching, and Governor Waller explicitly
mentioned these revisions in his speech last month, so it'll be an
important one for the timing of any rate cuts," said Deutsche Bank
strategist Jim Reid.
"I don't think there's any analytical reason to believe the bias will
continue to favor higher H2 inflation over H1, but the market is a bit
nervous after last year that the same seasonal adjustment pattern could
repeat."
Strong economic data and hawkish comments from Federal Reserve
policymakers in recent weeks have pushed back traders' bets that the
U.S. central bank will start cutting rates in March.
At 5:43 a.m. ET, Dow e-minis were up 9 points, or 0.02%, S&P 500 e-minis
were up 5.75 points, or 0.11%, and Nasdaq 100 e-minis were up 52.25
points, or 0.29%.
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Traders work on the floor at the New York Stock Exchange (NYSE) in
New York City, U.S., February 7, 2024. REUTERS/Brendan McDermid
The three main indexes were set for their fifth consecutive week of
gains as upbeat earnings reports offset jitters around the
interest-rate path and concerns about U.S. regional banks' exposure
to commercial real estate.
With the U.S. earnings season past the halfway mark, more than 80%
of the S&P 500 companies have topped profit estimates in the fourth
quarter, as per LSEG data. In a typical quarter, 67% of companies
beat estimates.
PepsiCo slipped 1.3% premarket after its fourth-quarter revenue fell
short of estimates as multiple price hikes crimped demand for its
juices and Lay's crisps.
Pinterest plunged 10.4% after it forecast first-quarter revenue
largely below Wall Street estimates, a sign that it faces tough
competition from larger social media players even as the digital
advertising market stabilizes.
Cloudflare rallied 25.5% as it forecast first-quarter revenue and
profit above market estimates, betting on strong demand for its
cloud and content delivery services.
Expedia fell 13.9% after the online travel platform warned that
revenue in 2024 would moderate as air ticket prices drop and said
CEO Peter Kern was stepping down.
(Reporting by Sruthi Shankar in Bengaluru; Editing by Pooja Desai)
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