Traders on the NYSE floor, Oct. 21, 2022.
Source: New York Stock Exchange
S&P 500 futures fell early Monday ahead of another batch of retail earnings to kick off the shortened Thanksgiving holiday week.
Futures tracking the Broad Market Index were down 0.35%. Dow Jones Industrial Average futures were down 84 points, or 0.25%. Nasdaq 100 futures fell 0.33%.
Each of the major averages rose in the previous trading session but fell in the week. The Dow Jones Industrial Average is up about 200 points, or 0.6%. The S&P rose 0.5% and the Nasdaq Composite closed just 0.01% above the flat line.
Investors are reflecting the strength of the recent bear market rally that started the month with the October CPI and gained momentum in wholesale prices last week. Traders were hung up on a message last week from a Federal Reserve official who was less than impressed with the numbers and reassessed optimism about a possible slowdown in inflation.
Ed Yardeni of Yardeni Research said in his view that the Oct. 12 low was a trough and that the S&P 500 could rise close to 4,300 by the end of the year, according to Friday night’s “Closing Bell: Overtime.” ” he told CNBC. The benchmark index is currently 3,965.34.
“What’s making a big difference in the market is the resilience of the economy. It’s remarkable,” he said. “Everyone has been debating whether it will be a soft or hard landing. In the meantime, there has been no landing at all. Consumers have not received a recession note and are continuing to spend.”
Retail sales rose in October, but at the corporate level, Target reported slowing demand and Amazon announced it would lay off 10,000 employees, while Home Depot and Walmart reported strong results. doing.
“Regardless of what holiday spending suggests, retail stocks tend to be in the top three in November, but in the bottom three in December and in the middle of the herd in January. SoFi chief investment strategist Liz Young said in a note this weekend.
“Seasonality plays an important role in market analysis and has some predictive power, but the forces of economic cycles are stronger at any time of the year,” she added. rice field. “With the Fed’s 375 basis point rate hikes so far, an inverted yield curve, soaring inflation and commodity prices still part of the story, we are forced to conclude that the economic cycle is lagging. not.”
After a historically quiet week ahead of Thanksgiving, investors will be busy with another group of retail earnings to digest before the post-holiday shopping season kicks off. Best Buy, Nordstrom, Dick’s Sporting Goods and Dollar Tree are among the companies on deck.
Investors can also receive economic reports on durable goods, new home sales, unemployment claims, consumer sentiment, and releases of the minutes of the last Federal Reserve Board meeting.
a week ahead It’s short. The market is closed on Thursdays for Thanksgiving. The stock exchange closes at 1:00 pm ET on Friday and the bond market closes at 2:00 pm ET.