Market Snapshot: U.S. stock futures struggling for momentum ahead of inflation report

by | Aug 9, 2022 | Stock Market

U.S. stock-index futures struggled for momentum on Tuesday as traders eschewed chunky bets ahead of July inflation data this week that may decide the fate of the recent summer rally.How are stock-index futures trading
S&P 500 futures
fell 11 points, or 0.3%, to 4,130.75.

Dow Jones Industrial Average futures
ticked down 19 points, or 0.1%, to 32,773.

Nasdaq-100 futures
lost 80.25 points, or 0.6%, to trade at 13,103.

On Monday, the Dow
eked out a gain of 0.1%, while the S&P 500
and Nasdaq Composite
each lost 0.1%. The Nasdaq Composite is up 18.8% from its 2022 low touched in mid-June, but remains down 19.2% for the year to date.

What’s driving markets Index futures were becalmed near recent highs ahead of the July consumer-price index report on Wednesday. Hopes that inflation may have peaked and that the Federal Reserve may thus be able to adopt a less aggressive monetary tightening cycle has helped the S&P 500 index bounce nearly 13% from its 2022 low touched in mid June. A corporate second quarter earnings reporting season that was not as bad as feared has also underpinned sentiment in recent weeks. However, a sales warning from semiconductor former darling Nvidia Corp.
on Monday has given bulls some pause for thought. And analysts warn the market’s optimistic tone of late will be further challenged should the CPI report come in hotter than expected. Read: Nvidia is hit by another ‘crypto hangover,’ and that isn’t the only problem

“This temporary calm could clearly all change tomorrow with the latest U.S. CPI so maybe the next 30 hours will be the calm before the storm or perhaps herald in the real start of the dog days of summer,” said analysts at Deutsche Bank. See: A surging stock market is on the verge of signaling a ‘huge’ move — but there’s a catch Economists forecast that a dip in energy prices will help headline year-over-year CPI for July fall from the multidecade high of 9.1% to 8.7%. Economic data on Tuesday showed U.S. productivity fell at a 4.6% annual rate in the second quarter, while unit labor costs shot up 10.8%. Meanwhile, the debate continues over whether the latest stock market advance is the start of a more prolonged uptrend or a rally that will fail when faced with slower economic growth and higher interest rates. Read: Why the S&P 500’s ‘bounce within a bear market’ could fizzle before it hits 4,200 Wells Fargo strategists warned that profit projections were too rosy. “We expect slowing revenue growth and higher costs to squeeze margins in the …

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