March S&P 500 futures (ESH23) are trending up +0.72% this morning after three major U.S. benchmark indices closed higher on Friday as market participants digested a deluge of economic data against rate hikes and recession fears while energy shares climbed amid higher oil prices. Three major U.S. stock indexes were fueled primarily by gains in the Oil & Gas, Utilities, and Consumer Services sectors.
A Commerce Department report revealed U.S. consumer spending barely increased in November while price pressures eased further. The core personal consumption expenditures (PCE) price index, the Fed’s preferred inflation measure, came in at +0.2% m/m and +4.7% y/y in November, in line with expectations. At the same time, the University of Michigan Surveys of Consumers showed U.S. consumers expect price pressures to moderate significantly in the next year as one-year inflation expectations dropped to 4.4% in December, the lowest figure in 18 months.
“This is a clear indication that this is bad news is good news kind of market. The market wants the Fed to feel what they're doing has been enough. It is on edge over what the path for Fed policy is going to be for next year as that's going to drive the economy and corporate earnings,” said Shawn Cruz, a head trading strategist at TD Ameritrade in Chicago, Illinois.
Oil prices rose on Friday, boosting shares of energy companies after Russia hinted at cutting crude output in response to the price cap imposed by the European Union and G7 nations.
In the coming week, market participants will be monitoring a spate of economic data, including U.S. Pending Home Sales, Richmond Manufacturing Index, Initial Jobless Claims, Crude Oil Inventories, and Chicago PMI.
Today, all eyes are focused on the U.S. S&P/CS HPI Composite - 20 s.a. data in a couple of hours. Economists, on average, forecast that October S&P/CS HPI Composite - 20 s.a. will stand at -1.1% m/m and +8.2% y/y, compared to the previous numbers of -1.2% m/m and +10.4% y/y.
Also, investors are likely to focus on the U.S. Goods Trade Balance preliminary data, which was at -98.80B in October. Economists foresee the new figure to be -96.90B.
In the bond markets, United States 10-Year rates are at 3.745%, down -0.05%.
The Euro Stoxx 50 futures are up +0.50% in thin post-Christmas holiday trading as positive sentiment continues in the final trading days of 2022, led by gains in industrials, banks, and energy stocks. European stocks have received a positive handover from their counterparts in Asia-Pacific after main indexes closed higher as China significantly relaxed its travel restrictions, raising hopes of a recovery in the world’s second-largest economy.
The European economic data slate is largely empty on Tuesday.
Asian stock markets today settled in the green. China’s Shanghai Composite Index (SHCOMP) closed up +0.98%, and Japan’s Nikkei 225 Stock Index (NIK) closed up +0.16%.
China’s Shanghai Composite today closed higher after the government further eased COVID-related restrictions and announced more financial support to COVID-hit sectors, including catering and tourism. China will end quarantine requirements for inbound travelers from January 8th, the National Health Commission announced on Monday. In addition, policymakers set out plans to expand domestic consumption and investment following the relaxation of severe COVID-related curbs and the subsequent surge of infections.
At the same time, Japan’s Nikkei 225 Stock Index closed higher after data showed the country’s retail sales rose for a ninth consecutive month in November as the cancellation of COVID-19 border controls and the government’s domestic travel subsidy supported consumer demand. The index’s upward momentum was fueled by gains in the Shipbuilding, Mining, and Chemical, Petroleum & Plastic sectors. The Nikkei Volatility, which takes into account the implied volatility of Nikkei 225 options, closed down 4.21% to 19.35.
Pre-Market U.S. Stock Movers
180 Life Sciences Corp (ATNF) climbed about +39% in pre-market trading, rebounding from Friday’s heavy losses after the company announced the closing of its $6M registered direct offering.
AMC Entertainment Holdings Inc (AMC) slid over -8% in pre-market trading, continuing to fall after last week’s announcement of a $110M equity capital raise.
Ecopetrol SA ADR (EC) rose more than +1% in pre-market trading, extending Friday’s gains after the company obtained authorization for the issuance of domestic bonds in Colombia.
Applied Molecular Transport Inc (AMTI) plunged over -8% in pre-market trading after SVB Securities and JMP Securities downgraded the stock following the company’s disappointing Phase 2 LOMBARD trial results.
Proterra Inc (PTRA) dropped more than -4% in pre-market trading after the company filed a $500M mixed securities shelf.
You can see more pre-market stock movers here
Today’s U.S. Earnings Spotlight: Tuesday - December 27th
Siemens Gamesa ADR (GCTAY), Sprott Physical Gold and Silver Trust (CEF), Mitek (MITK), Oramed (ORMP), GreenTree Hospitality (GHG), Gold Royalty (GROY), Blade Air Mobility (BLDE), Byrna Technologies (BYRN), Inotiv (NOTV), CEL-SCI (CVM), Wolford ADR (WLFDY), Ironnet (IRNT).
More Stock Market News from Barchart
- HP Inc Stock Is Attracting Value Buyers with Its High Yield and Low P/E
- AMC Entertainment (AMC) Takes the Lead in Unusual Options Activity
- Bank Holidays, Unemployment Claims and Other Key Themes To Watch This Week
- Kinder Morgan Looks Like a Safe High-Yield Bet for Value Investors
On the date of publication, Oleksandr Pylypenko did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes.
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