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Traders work at the New York Stock Exchange (NYSE) in New York City on July 20, 2023.
Brendan McDermid | Reuters
U.S. stock futures were little changed on Sunday as investors eagerly awaited the Federal Reserve’s latest preferred inflation reading as well as a series of important earnings reports.
Futures tied to the Dow Jones Industrial Average fell 0.04%, while S&P 500 futures and Nasdaq 100 futures fell 0.04% and 0.05%, respectively.
Stocks head into the final week of February on a high note after major indices hit new milestones on Friday and posted winning weeks helped by Nvidia’s blockbuster gains. The Dow Jones closed at an all-time high of 39,131.53, the broad-market S&P at one point in the session topped 5,100 for the first time and the tech-heavy Nasdaq Composite hit a 52-week high in Friday’s session .
Investors are now watching whether the AI momentum can last as economic and inflation risks persist. With that in mind, they are also looking ahead to the monthly personal consumption expenditures price index, the Federal Reserve’s favorite inflation gauge due out on Thursday.
“Nvidia has been the gift that keeps on giving with blockbuster earnings reports that drove the semis, tech and overall market higher this past week. With the market now up over 20% from its October 2023 low “We would expect the market to take a breather at some point,” Stephanie Lang, chief investment officer at Homrich Berg, told CNBC. “A more positive-than-expected PCE report this week could be a data point that could dampen market enthusiasm.”
“So far, stocks have shrugged off the Fed’s hawkish tone as the AI halo has taken center stage, but the market is confident in the Fed’s orchestration of a soft landing and the longer the Fed waits Federal, the greater the risk of that happy ending,” she added. “Still, the Fed is well aware that it wants to avoid a repeat of the intermittent adjustment of interest rates in the 1970s, when they failed to control inflation, so they remain patient to make sure they are safe that his work is done.”
There are a number of economic releases available, including January Durable Goods Orders data due on Tuesday and January Wholesale Inventories due on Wednesday.
Elsewhere, corporate profits are declining, but several high-interest names will release reports next week, which could give investors greater insight into the state of technology and the consumer.
Salesforce is the big name in technology this week; must report on Wednesday. Restaurants and several major retailers are also on deck, along with Norwegian Cruise, AMC Entertainment, JM Smucker, Hormel and Anheuser-Busch.