US stock futures tread water with more inflation, Fed cues on tap

© Reuters

Investing.com– U.S. stock index futures moved little in evening deals on Sunday, as a recent rally on Wall Street cooled in anticipation of more cues on inflation and the Federal Reserve later this week. 

S&P 500 Futures steadied at 5,291.50 points, while Nasdaq 100 Futures were flat at 18,572.75 points by 19:29 ET (23:29 GMT). Dow Jones Futures fell 0.1% to 39,835.00 points. 

Wall St faces consolidation after strong rally 

Wall Street indexes had surged to record highs last week after the Fed signaled it will cut interest rates at least thrice this year, while persistent hype over artificial intelligence also drove investors into heavyweight technology stocks, particularly NVIDIA Corporation (NASDAQ:NVDA).

But this rally cooled on Friday, with analysts now flagging some near-term consolidation in Wall Street as traders lock-in profits after a record-high rally so far in 2024. 

The S&P 500 fell 0.1% to 5,234.18 points on Friday. The NASDAQ Composite rose 0.2% to 16,428.82 points, buoyed chiefly by Nvidia, while the Dow Jones Industrial Average slid 0.8% on Friday to finish at 39,475.90 points. 

All three indexes still remained largely in sight of record highs hit last week, and were sitting on a 4% to 10% rise so far in the first quarter of 2024. Quarter-end repositioning may also spur some weakness on Wall Street. 

Anticipation of more inflation data and signals from the Federal Reserve also kept markets on edge.

PCE inflation, Fed speakers on tap this week

Personal consumption expenditures data, which is the Fed’s preferred inflation gauge, is due this Friday. Given that the Fed recently reiterated its stance that inflation will drive the path of interest rate cuts in 2024, markets were on guard ahead of the reading.

While U.S. inflation has fallen considerably in the past year amid high interest rates, it still remains well above the Fed’s 2% annual target- a trend that has remained a major point of contention for the central bank.

A slew of Fed officials are also due to speak this week, with rate-setting committee members Raphael Bostic and Mary Daly set to speak on Monday and Friday, respectively. 

Fed Chair Jerome Powell is also set to speak during the week, after striking a somewhat dovish tone at a Fed meeting last week.