US stock futures are pointing lower this morning as we kick off the final quarter of the year. Investors are awaiting a raft of economic data and parsing through Fed Chair Jerome Powell’s recent comments.
On Monday, the S&P 500 hit a fresh record high after rebounding from a dip caused by Powell’s statement that the Fed isn’t in a rush to roll out more interest rate cuts after the 50-basis point reduction last month. Meanwhile, the Dow Jones Industrial Average reached a new all-time high, and the Nasdaq gained 70 points (0.4%). Despite a choppy start, all three major indices advanced in both September and the third quarter.
Analysts at Vital Knowledge noted that Monday was relatively subdued as traders prepare for key October economic data. Expect some volatility as the first batch of US economic reports rolls out this week, potentially influencing the Fed’s rate cut decisions.
Today’s Job Openings and Labor Turnover Survey (JOLTS) is expected to show 7.64 million available jobs in August, a slight dip from July’s 7.67 million. This is a key indicator of labor demand, and investors will be watching closely for any signs of a cooling job market.
Later in the week, the Institute for Supply Management’s (ISM) manufacturing and services PMIs will provide further insight into the state of the economy. The manufacturing PMI is expected at 47.6—still in contraction territory—while the non-manufacturing PMI is forecasted to slightly improve to 51.6.
Fed Chair Powell emphasized yesterday that the Fed isn’t in a hurry to cut rates further, despite the aggressive rate cut last month. He reassured that the economy remains in “solid shape” and indicated that any future cuts will likely be more measured. Powell hinted at the possibility of two more cuts by the end of 2024 if conditions warrant it, but stressed that there’s no preset course for rate policy.
In other news, 23andMe (NASDAQ
) CEO Anne Wojcicki ruled out third-party takeover bids, signaling her intent to take the company private. This follows the resignation of seven independent directors after a stalled management buyout proposal.
Oil prices are slipping again as concerns about demand outweigh tensions in the Middle East. Brent crude is down 0.8% to $71.13 per barrel, and WTI is trading 0.9% lower at $67.59. Both benchmarks ended September with steep losses—Brent down 9%, its largest drop since November 2022, and WTI down 7%.
We expect some red in the markets today, so be prepared for volatility. See you all in chat with the upgrades and downgrades!
Keep stacking, OP!
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