Good morning, traders!
The S&P 500 ($SPY) is trading below yesterday’s close. Let’s get into it…
U.S. stock futures trade slightly lower today, largely influenced by a disappointing outlook from tech giant Intel. This pessimistic forecast affected the entire tech sector, with S&P 500, Dow Jones Industrial Average, and Nasdaq 100 futures all experiencing declines. Notably, Intel’s shares plummeted by over 10% in premarket trading, a significant drop that also impacted other tech companies like AMD and Nvidia.
The stock market is also closely watching the latest corporate earnings for insights into the health of the U.S. economy. Companies like Colgate-Palmolive and American Express are under the spotlight, especially following Visa’s modest revenue growth forecast. Despite the current setbacks, the stock market has been on an upward trend, with the S&P 500 and Nasdaq Composite climbing for six consecutive sessions and the S&P 500 reaching record highs for five straight trading days.
Investors are keenly awaiting the Personal Consumption Expenditures (PCE) index for December, a critical indicator for inflation. This index is particularly important as it could influence the Federal Reserve’s decision on interest rate cuts. A preliminary report showing stronger-than-expected economic growth in the last quarter of the previous year suggests that the Fed might delay rate cuts beyond March in an effort to ensure a smooth and stable economic landing.
The release of December’s personal consumption expenditures price index, a key measure of inflation, showed results in line with economists’ forecasts. This data is crucial for the Federal Reserve in setting monetary policy. Additionally, recent gross domestic product data indicated higher-than-expected economic growth in the fourth quarter, bolstering investor confidence that the economy may avoid a deep recession. This economic optimism is tempered by the latest developments, highlighting the market’s sensitivity to various economic indicators and corporate earnings reports.
Friday Economic Events:
Personal Income and Outlays 8:30am ET – High Volatility Expected
Pending Home Sales Index 10:00am ET
Baker Hughes Rig Count 1:00pm ET
Fed Speaker Scheduled:
No Fed Speakers Scheduled
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