In overnight trading on Monday, stock futures edged higher as investors awaited a pivotal inflation report that could influence the Federal Reserve’s monetary policy trajectory.
Futures tied to the Dow Jones Industrial Average rose by 30 points, representing a marginal gain of less than 0.1%. S&P 500 futures saw a slight uptick of 0.2%, while Nasdaq 100 futures recorded a modest increase of approximately 0.4%.
The spotlight is firmly on the February release of the consumer price index (CPI), scheduled for Tuesday at 8:30 a.m. ET. Economists surveyed by Dow Jones anticipate a monthly increase of 0.4% and a year-over-year rise of 3.1% on the headline CPI.
January’s CPI uptick stirred market volatility and prompted Federal Reserve officials to adopt a more cautious stance on policy easing. Current market pricing suggests that the Fed is unlikely to cut interest rates at its upcoming meetings on March 19-20 or April 30 to May 1.
Bill Adams, chief economist at Comerica Bank, commented, “The CPI index likely ran hot in February on higher gasoline prices, but core inflation likely slowed further as car prices fell and rent increases moderated.”
The recent retreat of technology-heavy sectors has contributed to a loss of momentum in the broader market rally. Nvidia, one of the prominent performers this year, witnessed a 2% decline on Monday following a more than 5% drop on Friday, marking its largest single-day decline since May 2023.
Other constituents of the so-called “Magnificent Seven” have also experienced pullbacks in recent sessions. Apple shares have declined by 8.5% over the past month, while Alphabet has slid by 7.6%. Microsoft has retreated by nearly 4% during the same period, and Tesla has fallen by 8.2%.
Mark Hackett, Nationwide’s chief of investment research, remarked, “As the market broadens beyond mega-cap tech names, investors can expect to see more consolidation and fairly modest returns in the high-level market-based indexes.”
