Futures pull back as investors await data, Fed comments

[June 17, 2024]  (Reuters) - U.S. stock index futures were mixed in muted trading on Monday as investors awaited fresh economic data and comments from Federal Reserve officials for more clarity on monetary policy.

S&P 500 futures retreated slightly after hitting multiple record highs in the previous week, while the tech-heavy Nasdaq inched up as megacap stocks including Apple, Microsoft and Nvidia rose between 0.2% and 0.6%.

The blue-chip Dow was the only one of the three major indexes to post weekly declines on Friday, while the Nasdaq notched its fifth consecutive record closing high and posted gains of 3.2% for the week.

Some investors, however, have been concerned about the sustainability of the equity rally as megacap growth and technology stocks were behind most of Wall Street's gains this year.

Goldman Sachs still raised its 2024 year-end target for the S&P 500 Index to 5,600 from 5,200 earlier, representing about a 3.1% upside to the index's last close.

On the economic roster for the week are May retail sales data on Tuesday, with industrial production, housing starts and S&P flash PMI data among other key releases due later in the week.

The New York Fed's Manufacturing survey is expected before markets open on Monday. Comments from the New York Fed's John Williams and the Philadelphia Fed's Patrick Harker are also expected later in the day.

Recent hawkish projections from the Federal Reserve have somewhat contrasted several data releases pointing to growing weakness in the economy. The central bank dialed back their projections for three rate cuts in 2024 to just one on Wednesday.

A Wall Street sign is pictured outside the New York Stock Exchange in the Manhattan borough of New York City, New York, U.S., October 2, 2020. REUTERS/Carlo Allegri/File Photo

However, market pricing still shows expectations of around two 25 basis point cuts this year, according to LSEG data. The CME FedWatch tool shows easing is still seen beginning at the September meeting.

"Chair Jerome Powell characterized the U.S. consumer as 'solid' and unless there is another downside surprise here, we cannot see market pricing of 1-1/2 Federal Reserve rate cuts this year moving substantially," analysts at ING said in a note.

Minneapolis Fed President Neel Kashkari said one Fed rate cut in December was a "reasonable prediction" in an interview on Sunday.

At 5:48 a.m. ET, Dow e-minis were down 55 points, or 0.14%, S&P 500 e-minis were down 3 points, or 0.06%, and Nasdaq 100 e-minis were up 29.5 points, or 0.15%.

Autodesk shares jumped 4% after a report that activist investor Starboard Value had bought a roughly $500 million stake in the software maker.

A shorter trading week is on deck as markets will be closed on Wednesday.

(Reporting by Lisa Mattackal in Bengaluru; Editing by Devika Syamnath)

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