Inventory futures slip forward of Fed Chair Powell’s speech in Jackson Gap

Stock futures fell on Friday as investors awaited Federal Reserve Chair Jerome Powell’s speech in Jackson Hole, Wyoming.

Futures linked to the Dow Jones Industrial Average fell 87 points, or 0.3%. S&P 500 futures traded 0.4% lower, and Nasdaq 100 futures slipped 0.6%.

The moves followed a day’s gain for the major averages in which the Dow jumped about 300 points, and the S&P 500 gained 1.4%. The Nasdaq Composite was the best, up 1.7% as the pullback in yields helped tech stocks.

“Overall, this remains a very attractive moment to invest in equities. Underlying firm performance is strong for a top quality company, and multiples are down on macro scares. That’s the setup every long-term investor looks for,” Robert Cantwell, a portfolio manager in Upholdings, told CNBC.

Nevertheless, all major averages are on pace for the second week in a row. The Dow is on track for a 1.2% decline. The S&P 500 and Nasdaq Composite were headed for slightly smaller losses of 0.7% and 0.5%, respectively.

All eyes are on Powell’s widely anticipated 10 am ET speech at the central bank’s annual symposium in Wyoming.

Investors are I hope you get new guidance about how the Fed will act this fall, but expectations are lower, with many expecting Powell to repeat the Fed’s pledge to slow inflation by raising interest rates. Opinions are divided on whether the Fed will raise interest rates by half a percentage point or three quarters of a point at its next policy meeting in September.

Personal consumption spending, one of the Fed’s favorite inflation measures, will also be watched ahead of Powell’s speech Friday morning.

“We’re likely to see some relief tomorrow unless we get a big shock from what Powell said,” Gabriela Santos, global market strategist at JP Morgan Asset Management, told CNBC’s “Closing Bell: Overtime.” “One thing I’d notice if we look to the week ahead and into the fall … implied bond volatility is still very, very high to where it usually is at the end of August, suggesting that in fact we’re likely to continue to see a lot of action in the yield curve, which could affect the stock market in the fall.”

Leave a Reply

Your email address will not be published. Required fields are marked *