On Tuesday, U.S. stock futures displayed mixed results as market participants awaited new reports on employment and manufacturing. These upcoming figures could offer insights regarding the potential trajectory of interest rate reductions. Futures for the Dow Jones Industrial Average fell by 0.2%.
Futures for the S&P 500 remained slightly below even, while the tech-centric Nasdaq 100 contracts also showed minimal change. The performance of stocks at the beginning of October and the fourth quarter is showing some inconsistency.
The market is processing the Federal Reserve’s approach to interest rates. The Fed’s chair indicated that policymakers are not rushing to decrease rates, aiming instead to maintain economic stability.
This has led traders to decrease predictions for an additional 0.5% rate cut. A report on job openings is scheduled for release later, which could alter those expectations if it underperforms.
The Federal Reserve is zeroing in on the labor market. Insights from ISM and S&P Global regarding manufacturing activity are also expected to garner attention, potentially shedding light on the pace at which the U.S. economy is decelerating.
The results will set the stage for the September jobs report, anticipated on Friday. Investors view this as a vital metric. Additionally, a storm affecting the East and Gulf coasts poses a risk to the flow of around half of the U.S.’s ocean shipping.
The repercussions of this extensive disruption could cost the economy billions daily and intensify inflationary pressures, jeopardizing job security. Investors are also vigilant regarding geopolitical situations in the Middle East.
In business news, Barclays analyst Tim Long maintained a cautious stance on Apple, citing subdued demand for the iPhone 16. Overall, investors are looking for evidence that the U.S. economy is tempering rather than collapsing.
The Dow Jones Industrial Average experienced a decline on Tuesday as Wall Street braced for significant economic data. Before the market opened, futures for the Dow fell by 0.3%. S&P 500 futures decreased by 0.1%.
Futures for the tech-focused Nasdaq 100 rose slightly in early trading. Earlier on Tuesday, the yield on the 10-year Treasury dropped to 3.75%. Oil prices declined, with West Texas Intermediate futures trading around $67.60 per barrel.
Google stock saw a 1.6% increase in premarket trading on Tuesday. Pivotal Research commenced coverage of the search giant with a buy recommendation and a target price of $215, representing a 30% premium over Monday’s close.
Wall Street anticipates economic reports
Shares of Alphabet are regaining their 50-day average this week. Several significant reports are expected on the economic front.
The Purchasing Managers’ manufacturing index is expected to be released at 9:45 a.m. ET. At 10 a.m. ET, the Institute for Supply Management’s manufacturing report, the Commerce Department’s construction spending data, and the Labor Department’s Job Openings and Labor Turnover Survey (JOLTS) will be released. The PMI manufacturing index is projected to fall to 47.0 in September from August’s 47.9, while construction spending is anticipated to decrease by 0.3% in August.
Job openings are forecasted to remain stable at 7.7 million in August. Notable earnings moves on Tuesday include Acuity Brands, which rose 2.8% in premarket trading, and McCormick, which climbed 1.5%.
Paychex stock increased by 1.7% during morning trading. On Monday, the Dow Jones Industrial Average experienced a slight uptick, while the S&P 500 rose by 0.4%.
The Nasdaq composite also gained 0.4%. Notable stocks included Google, Nvidia, Apple, and Tesla. Nvidia stock rose by 0.5% on Tuesday, maintaining its position above the 50-day line.
Tesla’s stock rose by 0.4% on Tuesday morning, approaching a buy point of 274. Amazon, Apple, and Microsoft stocks are under close surveillance. Amazon shares are near a buy point of 195.37.
Apple is positioned near a V-shaped cup with handle that indicates an entry point of 232.92. Microsoft has rallied back above its 50-day benchmark and is approaching a 441.85 buy point in a cup with a handle formation. Investors are focused on managing the present trading conditions.
They are also in search of opportunities as essential economic data draws near. Wall Street is set for a muted opening on Tuesday as market participants await critical labor data. Federal Reserve Chair Jerome Powell has indicated that only minor rate cuts might be forthcoming.
In the latest updates, futures for the Dow Jones Industrial Average were down by 0.29%. S&P 500 futures dipped by 0.10%, while Nasdaq futures displayed a slight rise of 0.01%.
The market remains alert to the August JOLTS report and the September ISM survey, both scheduled for 10 a.m. ET, as these will offer further insights regarding the U.S. labor market and economic landscape. Among individual stocks, Boeing experienced a downturn following reports suggesting the company is considering a potential capital infusion.
A strike at ports has halted a significant amount of ocean shipping; however, retail stocks remained largely stable. In the meantime, government bonds rallied on Tuesday, bolstered by eurozone inflation data reinforcing the argument for more rapid rate cuts by the European Central Bank. The dollar strengthened after Powell’s comments which moderated expectations of a second substantial U.S. rate reduction.
Investors and analysts will continue to closely observe these developments as they may have vital repercussions for financial markets in the weeks to come.
