Stock futures saw a slight increase in overnight trading on Monday as investors eagerly awaited the release of a key inflation report that might potentially influence the Federal Reserve’s monetary policy. Futures for the Dow Jones Industrial Average gained around 30 points, while S&P 500 futures inched up by 0.2% and Nasdaq 100 futures experienced a gain of approximately 0.4%.
All eyes are currently fixated on the upcoming release of the February reading of the consumer price index (CPI) at 8:30 a.m. ET on Tuesday. Economists polled by Dow Jones have predicted a monthly gain of 0.4% and anticipate a 3.1% increase on the headline figure.
The January uptick in CPI figures caused considerable market disruption and prompted Federal Reserve officials to adopt a more cautious stance on easing policy. As a result, the current market indicators suggest that interest rates will not be cut during the upcoming Federal Reserve meetings scheduled for March 19-20 or April 30 to May 1.
Bill Adams, chief economist at Comerica Bank, believes that while the CPI index likely experienced a surge due to higher gasoline prices in February, core inflation may have further slowed as car prices fell and rent increases moderated.
The recent decline in the market rally led by technology giants has started to raise concerns. Nvidia, for instance, witnessed a decline of 2% on Monday and more than 5% on Friday, marking its biggest one-day drop since May 2023. Similarly, other members of the prominent tech group, commonly referred to as the “Magnificent Seven,” have also experienced setbacks. Apple shares have depreciated by 8.5% over the past month, while Alphabet and Microsoft have seen declines of 7.6% and 4% respectively in the same period. Tesla, too, has taken a hit, with an 8.2% fall.
Mark Hackett, Nationwide’s chief of investment research, believes that as the market moves beyond mega-cap tech names, investors should expect more consolidation and relatively modest returns in market-based indexes.
