US equity futures struggled for traction on Tuesday as traders awaited a raft of economic figures over the next few days, with the Federal Reserve’s data dependence firmly in mind.
(Bloomberg) — US equity futures struggled for traction on Tuesday as traders awaited a raft of economic figures over the next few days, with the Federal Reserve’s data dependence firmly in mind.
Contracts on the S&P 500 and Nasdaq 100 fluctuated before turning lower, suggesting US stocks will battle to build on Monday’s solid gains. Treasury yields and the dollar were steady.
Among individual movers in premarket trading, electronics and appliances retailer Best Buy Co. Inc. climbed after reporting results that showed a slump in demand is easing. Verizon Communications Inc. and AT&T inc. rose after Citigroup Inc. upgraded the stocks to buy, saying it sees a more constructive investment case for large-cap telecommunications firms.
Despite this week’s gains, global stocks are on track for their worst month in almost a year as policy makers remain determined to stifle inflation. Economic reports are assuming even more importance than usual after Fed Chair Jerome Powell reiterated at Jackson Hole last week that the central bank is ready to raise rates further if the data suggests that is appropriate.
“August has been a challenging month for markets, with investor sentiment cautiously picking up again,” said Victoria Scholar, head of investment at Interactive Investor. “Focus will be on key economic data from the US this week, with hopes that this will fuel expectations that the economy stateside is heading for a soft landing.”
Traders will be monitoring US consumer confidence data later Tuesday. Other reports this week include US employment growth, the core PCE deflator and August’s payrolls and wages data. Euro-area inflation readings will be in focus this week as well.
Miners led an advance in the Stoxx Europe 600 index after China signaled further measures to support its economy. NN Group NV jumped as much as 11% after the financial-services company reported results that beat analysts’ expectations. European bonds gained, with the German 10-year yield falling three basis points to 2.54%.
The UK’s stock benchmark outperformed as it reopened after Monday’s holiday. The British pound edged higher after the slowest increase in grocery bills in almost a year drove down inflation in shops in August, relieving some of the pressure on the Bank of England to keep raising interest rate hikes.
An Asian equity gauge rose 0.8%, supported by gains across major indexes in the region. The Hang Seng Index extended its increase into a second day and China’s stocks outperformed, with the Hang Seng China Enterprises Index rising more than 2%. China is poised to cut interest rates on trillions of yuan of outstanding home mortgages for the first time since the global financial crisis, as policymakers dig deeper into their toolkit to shore up growth in the world’s second-largest economy.
“If policy measures continue to be unveiled in the coming weeks, the market narrative may shift from ‘too little, too late’ to a more confident stance as policymakers regain credibility,” UBS Global Wealth Management strategists including Solita Marcelli and Mark Haefele wrote in a note.
In commodities, oil climbed toward $81 per barrel as traders waited for the next set of clues on the outlook for crude demand in the US and China. Gold was little changed.
Key events this week:
- US Conference Board consumer confidence, Tuesday
- Eurozone economic confidence, consumer confidence, Wednesday
- US GDP, wholesale inventories, pending home sales, Wednesday
- China manufacturing PMI, non-manufacturing PMI, Thursday
- Japan industrial production, retail sales, Thursday
- Eurozone CPI, unemployment, Thursday
- ECB publishes account of July monetary policy meeting, Thursday
- US personal spending and income, initial jobless claims, Thursday
- China Caixin manufacturing PMI, Friday
- Eurozone S&P Global Eurozone Manufacturing PMI, Friday
- South African central bank governor Lesetja Kganyago, Atlanta Fed President Raphael Bostic, BOE’s Huw Pill, IMF’s Gita Gopinath on panel at the South African Reserve Bank conference, Friday
- Boston Fed President Susan Collins speaks at virtual event, Friday
- US unemployment, nonfarm payrolls, light vehicle sales, ISM manufacturing, construction spending, Friday
Some of the main moves in markets:
- S&P 500 futures fell 0.1% as of 8:25 a.m. New York time
- Nasdaq 100 futures fell 0.2%
- Futures on the Dow Jones Industrial Average fell 0.1%
- The Stoxx Europe 600 rose 0.5%
- The MSCI World index rose 0.1%
- The Bloomberg Dollar Spot Index rose 0.3%
- The euro fell 0.3% to $1.0790
- The British pound fell 0.3% to $1.2570
- The Japanese yen fell 0.5% to 147.27 per dollar
- Bitcoin was little changed at $25,969.75
- Ether fell 0.4% to $1,640.34
- The yield on 10-year Treasuries advanced two basis points to 4.22%
- Germany’s 10-year yield was little changed at 2.57%
- Britain’s 10-year yield advanced two basis points to 4.46%
- West Texas Intermediate crude rose 0.6% to $80.61 a barrel
- Gold futures fell 0.2% to $1,943.70 an ounce
This story was produced with the assistance of Bloomberg Automation.
–With assistance from Tassia Sipahutar, Jan-Patrick Barnert and Sagarika Jaisinghani.
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