Stock futures are showing little movement as a new week begins, following a recent market pullback that paused the 2024 rally.
Last week saw major indices decline, with the Dow dropping by 2.3%, its worst week since March 2023. The S&P 500 fell by nearly 1%, its largest weekly loss since early January, and the Nasdaq Composite decreased by 0.8%, marking its fourth negative week out of the last five.
Despite the overall downward trend, the market ended last week positively, driven by a strong jobs report on Friday. The unexpected increase in payrolls boosted investor confidence, indicating that a strong economy could support corporate earnings growth even with the possibility of higher interest rates.
Chief Economist at Comerica Bank, Bill Adams, mentioned, “Jobs and wages are increasing steadily, and overall payrolls are outpacing inflation, which will encourage Americans to spend in 2024 and drive the economy forward.”
Investors are eagerly waiting for the release of consumer and producer price indexes for March later this week to gain more insight into the Federal Reserve’s actions against inflation.
Economists predict that the CPI (Consumer Price Index) will rise by 0.3% last month, with a year-over-year increase of 3.5%, with the report set to be released on Wednesday morning.
Founder of Vital Knowledge, Adam Crisafulli, stressed the significance of inflation data, saying, “The Fed appears unconcerned about strong employment gains… Inflation, however, is a bigger concern, and it is crucial that the March price data (CPI, PPI, PCE) show progress towards reducing inflation.”
Investors are also monitoring rising bond yields and oil prices. The benchmark 10-year Treasury yield rose by around 20 basis points last week to about 4.4%, while U.S. crude oil prices reached $87 amid ongoing geopolitical tensions.
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