The major U.S. index futures point to a positive start on Wall Street Friday morning. The focus will clearly be on Federal Reserve’s annual Jackson Hole symposium.
The Dow futures are gaining 0.26 percent. The S&P futures are up 0.3 percent and the Nasdaq futures are higher by about 0.35 percent.
Comments from Fed officials at the meeting may impact the outlook for monetary policy following recent indications the central bank plans to begin scaling back asset purchases this year.
At the virtual conference, the Federal Reserve’s policymakers are expected to present a timeline for tapering the central bank’s bond-buying program.
The Federal Reserve Chairman Jerome Powell, schedule to speak at 10 AM ET, is expected to provide cues on the central bank’s tapering timeline.
Meanwhile, in geopolitical news, U.S. President Joe Biden vowed to hunt down the terrorists and make them pay for the deadly attacks after the ISIS claimed responsibility for the blasts that killed at least 13 U.S. service members and 60 Afghans.
U.S. stocks closed weak on Thursday, after having consistently climbed fresh highs in recent sessions amid continued optimism about growth and on hopes the Federal Reserve might not begin tapering its bond-buying program anytime soon.
Investors stayed quite wary of making significant moves as they looked ahead to comments from Fed officials at the annual Jackson Hole symposium on Friday.
The attack by suicide bombers near Kabul airport that resulted in the death of 12 US services members, and injuries to several others hurt sentiment.
Traders also reacted to comments from President of the St. Louis Fed James Bullard, and Kansas City Fed President george. Bullard said he is of the view that the central bank should start tapering bond purchases in the fall and finish the process by the first quarter of next financial year. He has also called for a rate hike by end 2022.
George said the Fed should start trimming its monthly bond purchases “sooner rather than later” even though the delta variant poses a risk to the US economic outlook.
Among the major averages, the S&P 500 and the Nasdaq suffered their first losses in six sessions. The Dow ended down by 192.38 points or 0.54 percent at 35,213.12. The S&P 500 settled at 4,470.00 with a loss of 26.19 points or 0.58%, while the Nasdaq declined 96.05 points or 0.64 percent to settle at 14,945.81.
First-time claims for U.S. unemployment benefits edged slightly higher in the week ended August 21st, according to a report released by the Labor Department on Thursday.
The report said initial jobless claims inched up to 353,000, an increase of 4,000 from the previous week’s revised level of 349,000.
Economists had expected jobless claims to tick up to 350,000 from the 348,000 originally reported for the previous week.
Meanwhile, a report from the Bureau of Economic Analysis said the US economy advanced an annualized 6.6 percent on quarter in the second quarter, slightly higher than an earlier estimate of 6.5 percent. However, the increase was below the 6.7 percent increase analysts had forecast.
Among the prominent losers in the session, Walgreens Boots Alliance and Boeing both ended more than 2 percent down. Nike, Chevron, Caterpillar, Intel and Walmart shed 1 to 1.7 percent.
IBM, American Express, Microsoft, Home Depot and McDonalds also closed weak.
Shares of department store retailer Burlington Stores, Inc. plunged more than 9 percent despite the company turning to profit in the second quarter and beating market expectations.
Dollar General shares declined nearly 4 percent after the company reported a 13.8 percent drop in second-quarter earnings.
Salesforce.Com shares gained more than 2.5 percent, continuing to ride on strong quarterly results. Honeywell International climbed nearly 1.5 percent.
Commodity, Currency Markets
West Texas Intermediate Crude oil futures are gaining $1.10 or 1.62 percent at $68.52 a barrel.
Gold futures are up $3.10 or 0.17 percent at $1,798.30 an ounce, while Silver futures are rising $0.085 or 0.3 percent at $23.635 an ounce.
On the currency front, the dollar index is at 93.01, down 0.06 percent from the previous close.
Against the yen, the dollar is trading at 110.18, after closing at 110.09 on Thursday. Against the Euro, the dollar is quoting at 1.1761, compared to previous close of 1.1753.
Asian stocks turned in a mixed performance on Friday as investors fretted over developments in Afghanistan and watched for any potential shift in U.S. Federal Reserve policy.
Investors awaited Fed Chair Jerome Powell’s speech at the Fed’s annual Jackson Hole gathering for details on how and when the U.S. central bank might look to taper its monetary policy.
Chinese stocks advanced despite reports that the government will propose new regulations targeting companies seeking foreign listing via units incorporated outside the country. The benchmark Shanghai Composite index rose 20.49 points, or 0.59 percent, to 3,522.16 while Hong Kong’s Hang Seng index ended little changed with a negative bias.
Japanese shares fell slightly, with the Nikkei average ending down 101.15 points, or 0.36 percent, at 27,641.14. The broader Topix index slipped 0.34 percent to settle at 1,928.77 ahead of busy week of economic releases, including U.S. jobs data for August and flash Eurozone inflation figures.
SoftBank Group eased 0.4 percent and Uniqlo operator Fast Retailing ended down over 1 percent.
Takeda dropped half a percent to extend losses for the fourth straight session after the drug maker and the government said Japan would halt the use of more than one million doses of Moderna’s Covid vaccine.
Australian shares ended marginally lower to extend losses for a second straight session as tech stocks followed their U.S. peers lower on fears of a dramatic shift in the Fed’s approach to monetary policy.
The S&P/ASX 200 edged down 0.04 percent, while the broader All Ordinaries index ended lower by 0.13 percent.
Seoul stocks ended slightly higher after a choppy session. The benchmark Kospi edged up 5.37 points, or 0.17 percent, to 3,133.90.
New Zealand shares finished marginally higher after Vista, the global leader in cinema management software, said blockbuster movies had started returning to cinemas in key markets. Vista shares soared 8.4 percent.
The NZX 50 index edged up 0.06 percent.
European stocks are subdued Friday afternoon following twin blasts in Kabul airport and amid uncertainty over U.S. monetary policy.
Traders also await Fed Chair Jerome Powell’s symposium speech later today for clues on how the U.S. central bank might pare bond purchases.
On the economic front, a survey showed that French consumer confidence eased marginally in August.
Further, data from Sweden’s National Institute of Economic Research showed that the country’s economic confidence weakened in August. The economic tendency indicator rose to 121.1 in August from 121.9 in July.
Finland’s consumer confidence weakened and industrial morale improved in August, as per separate survey results. Statistics Finland said the consumer sentiment index decreased to 4.0 in August from 4.4 in July.
The pan European Stoxx 600 is down marginally. The U.K.’s FTSE 100 is declining 0.13 percent, Germany’s DAX is down slightly, and France’s CAC 40 is lower by 0.2 percent.
In France, BNP Paribas is down nearly 1 percent, Credit Agricole is losing about 0.7 percent and Societe Generale is down 1 percent.
Automaker Renault is weak, while auto parts maker Faurecia jumped more than 2 percent after Citigroup hiked its target price on the stock.
STMicroelectronics is gaining more than 1 percent.
In Germany, Vonovia SE shares are modestly higher after the residential real estate company said it has placed corporate bonds totaling 5 billion euros with an average coupon of 0.49 percent. Based on high investor demand, the company said it was able to secure very attractive conditions.
Deutsche Bank, automakers BMW, Daimler and Volkswagen are trading subdued.
In the U.K., miners BHP, Rio Tinto, Anglo American and Glencore are trading higher as metal prices increased.
BP Plc and Royal Dutch Shell are moving up on firm crude oil prices.
Subprime lender Amigo climbed nearly 6 percent after it posted a steep rise in first-quarter pretax profit.
U.S. Economic Reports
Data showed personal income in the U.S. increased by 1.1 percent in July, after a revised 0.2 percent advance in June. Meanwhile, personal spending rose by 0.3 percent in July, after rising by an upwardly revised 1.1 percent in June.
Wholesale inventories in the U.S. increased by 0.6 percent month-over-month to $722 billion in July, cooling from an upwardly revised 1.2 percent rise in June, according to a preliminary estimate.
The personal consumption expenditure price index in the U.S.rose 0.4 perent in July, following a 0.5 percent increase a month earlier.
A final reading on Michigan consumer sentiment for the month of August is due out at 10 am ET.
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