US pre-open: Futures mixed ahead of PPI data

16th Feb 2024 12:27

(Sharecast News) - Wall Street futures were mixed ahead of the bell on Friday as market participants awaited some fresh inflation data.

As of 1225 GMT, Dow Jones futures were down 0.09%, while S&P 500 and Nasdaq-100 futures had the indices opening 0.20% and 0.58% stronger, respectively.

The Dow closed 348.85 points higher on Thursday as investors turned their attention to a slew of data points.

Friday's primary focus will be on January's producer price index, due out at 1330 GMT, with economists expecting to see a month-on-month increase of 0.1% to the headline figure and 0.6% yearly jump.

Elsewhere on the macro front, building permits and housing starts data will also be out at 1330 GMT, while a preliminary reading of the University of Michigan's consumer sentiment index will follow at 1500 GMT.

Trade Nation's David Morrison said: "US stock indices have completely shrugged off Tuesday's hotter-than-expected inflation numbers, along with yesterday's poor retail sales. Investors have put aside concerns that inflation may be stabilising one full percentage point above the Federal Reserve's inflation target, something that, as Fed Chair Jerome Powell has explicitly stated, would be a block to rate cuts. Investors have pushed out the timing of the first rate cut to June from March. In addition, according to the CME's FedWatch Tool, the market is pricing in 75-100 basis points worth of cuts this year, down from 150 at the end of January. So, if easier money through lower borrowing costs isn't the driving factor for the rally, what is?

"Well, the unexpected robustness of the US economy last year is one, as is the low unemployment rate. Both of these have been achieved against a backdrop of aggressive monetary tightening by the Fed since March 2022. Add in the belief that while expectations have been dialled down, lower rates are coming. At the same time, the fourth quarter earnings season is providing a boost, along with the bullish outlook for technological breakthroughs due to generative AI. No wonder there's so much excitement ahead of NVIDIA's earnings next week."

In the corporate space, delivery service DoorDash was in the red after reporting a wider-than-expected loss, while digital advertising company Trade Desk traded higher after topping revenue estimates with its Q4 earnings and issuing some upbeat guidance for Q1, and semiconductor equipment maker Applied Materials was also sharply higher on the back of its own positive quarterly numbers.

Markets will be closed on Monday in observance of the Presidents' Day public holiday.

Reporting by Iain Gilbert at Sharecast.com