(Bloomberg) — Stock futures pointed to a longer advance for the S&P 500 as investors sought vindication from Federal Reserve Chair Jerome Powell for bets on monetary easing.
Most Read from Bloomberg
Contracts on the S&P 500 futures rose 0.3% while those on the Nasdaq 100 added 0.4%. Treasuries advanced, with yields on two-year Treasuries near a three-month low. Tesla Inc. was set to extend gains for an 11th consecutive session, as Goldman Sachs Group Inc. analysts raised their price target following better-than-expected deliveries.
In his address yesterday, Powell emphasized mounting signs of a cooling job market but was careful not to offer a timeline for easing. Swap traders continue to project two interest-rate cuts in 2024, the first in September.
Further Congressional testimony by Powell on Wednesday, and key US inflation and jobs data tomorrow, may provide further clues on the policy path. The S&P 500 has already clocked up its longest winning streak since January.
Ahead of the latest print of the consumer-price index, bets on a steeper US yield curve are gaining attention. The idea behind the trade is the belief that rate cuts fan economic growth and inflation, which push down short-term yields and drive up longer-dated ones. Expectations for loose fiscal policy also bolster the view.
“We’re in position for curve steepeners,” Nicola Mai, sovereign credit analyst at Pimco, said in an interview with Bloomberg TV. “This year or early next year we should be getting to that disinversion of the curve for a couple of reasons. First of all rates should start to fall. Also I think the long end of the curve is going to remain high on fiscal concerns.”
In the premarket, Nvidia Corp. rose on evidence the AI boom continues to gain momentum, with its chip supplier Taiwan Semiconductor Manufacturing Co. reporting surging sales. 3M Co. slipped after saying its CFO resigned. Air Products climbed after Honeywell agreed to buy the company’s LNG unit.
Key events this week:
-
Jerome Powell testifies to the House Financial Services Committee, Wednesday
-
Fed’s Austan Goolsbee, Michelle Bowman and Lisa Cook speak, Wednesday
-
US CPI, initial jobless claims, Thursday
-
Fed’s Raphael Bostic and Alberto Musalem speak, Thursday
-
China trade, Friday
-
University of Michigan consumer sentiment, US PPI, Friday
-
Citigroup, JPMorgan and Wells Fargo earnings, Friday
Some of the main moves in markets:
Stocks
-
S&P 500 futures rose 0.3% as of 8:11 a.m. New York time
-
Nasdaq 100 futures rose 0.4%
-
Futures on the Dow Jones Industrial Average were little changed
-
The Stoxx Europe 600 rose 0.5%
-
The MSCI World Index rose 0.1%
Currencies
-
The Bloomberg Dollar Spot Index was little changed
-
The euro rose 0.1% to $1.0824
-
The British pound rose 0.2% to $1.2806
-
The Japanese yen was little changed at 161.47 per dollar
Cryptocurrencies
-
Bitcoin rose 1% to $58,486.01
-
Ether rose 1.2% to $3,109.38
Bonds
-
The yield on 10-year Treasuries declined three basis points to 4.27%
-
Germany’s 10-year yield declined six basis points to 2.52%
-
Britain’s 10-year yield declined six basis points to 4.10%
Commodities
-
West Texas Intermediate crude was little changed
-
Spot gold rose 0.6% to $2,378.57 an ounce
This story was produced with the assistance of Bloomberg Automation.
–With assistance from Richard Henderson.
Most Read from Bloomberg Businessweek
©2024 Bloomberg L.P.
Read More: S&P Futures Signal Endurance to Rate-Fueled Rally: Markets Wrap