Stock Futures Trade Sideways After Mixed Economic Data
Equity futures were little changed on Thursday night after a mixed session earlier, with investors digesting a host of mixed economic data and its implications for monetary policy.
S&P 500 contracts followed the flat line. Earlier, the blue chip index and the Dow Jones ended lower, breaking out of session lows at market close, but failing to enter positive territory.
The latest round of US economic data released Thursday painted a more bullish-than-expected picture of the US consumer. August retail sales posted a surprise increase as consumers turned to spending on goods amid the latest wave of the Delta variant. And while new weekly jobless claims rose in the latest Labor Ministry report, the level of new jobless claims was still near its lowest since March 2020.
Still, investors have looked at the latest data with continued caution about the outlook for the future, especially given the lingering uncertainties over the coronavirus, supply chain challenges, and next monetary policy actions and budgetary.
“I think it’s really this showdown right now that is going on, that is, there is still some good news on the economy. In fact, in the last couple of days. We have received good reports of regional surveys from the Fed and today retail sales figure, “Mark Luschini, chief investment strategist for Janney Montgomery Scott, told Yahoo Finance on Thursday.
“But at the same time, it is against the background of this overall deceleration in growth that we have experienced so far in the third quarter. [and] worried about the Delta variant. And of course, we are facing prospects and discussions around taxes to finance fiscal stimulus programs and as well as a possible debt ceiling debacle, ”he added. “So there are a lot of things that are creating cross-currents for investors right now, which creates this environment in which day after day you switch between cyclical and defensive stocks without any real pattern being sparked by the one or the other. “
At Thursday’s close and two weeks from the end of September, the S&P 500 was heading for its first monthly decline since January. Although the Blue Chip Index is still less than 2% from an all-time high, it has traded flat to slightly lower in recent weeks as traders wait for the next catalysts.
“We’ve had a lot of back and forth, and I think that reflects a market that has grown 20%, a lot has already been incorporated,” John Lynch, chief investment officer of Comerica Wealth, told Yahoo Finance. Management. “We are entering the quiet period ahead of third quarter profits. Even though third quarter profits are up 30%, they will be a third of what second quarter profits did. So investors have a long way to go. with that. “
He added, however, that stocks still benefit from a lack of competition in many other areas of the market, especially given current monetary policy.
“If you think real rates are always negative, whether M2 or the money supply is increasing twice the rate of GDP, that’s an offer for stocks despite some of the uncertainty,” Lynch said.
6:13 p.m. ET Thursday: The opening of equity futures was little changed
Here are the main movements in the markets as of Thursday evening:
S&P 500 Futures Contracts (ES = F): -3.75 points (-0.08%) to 4,470.50
Dow Futures (YM = F): -14 points (-0.04%) to 34,735.00
Nasdaq Futures (NQ = F): -11.25 points (-0.07%) to 15,506.50
Emily McCormick is a reporter for Yahoo Finance. Follow her on Twitter: @emily_mcck