Monday December 12th


Stock futures nudge higher to start the week with Fed meeting, key inflation data on deck

U.S. stock index futures were fractionally higher early Monday ahead of a week with several anticipated events in the ongoing fight against inflation. Futures for the Dow Jones Industrial Average added 50 points, or 0.15%. Those for the S&P 500 and Nasdaq 100 edged 0.2% and 0.26% higher, respectively. The move in futures comes as investors will be focused on inflation this week. On Tuesday, the November consumer price index will be released, and traders will be looking for a sign that inflation is slowing. The Federal Reserve has a two-day meeting starting the same day. The central bank is expected to announce another rate hike on Wednesday, though traders are anticipating a smaller move than in recent months. In addition to the expected rate hike, the Fed’s updated economic projections and Chair Jerome Powell’s press conference could be key signals for what the central bank wants to do in the coming months. “Financial conditions have eased dramatically since the October CPI reading released last month, so the Fed will likely use the December FOMC meeting to walk those back,” said Cliff Hodge, chief investment officer for Cornerstone Wealth. “We think the markets are too sanguine on rates after the first quarter and we expect Powell to take a more hawkish tone and for the dots to indicate higher rates for a longer period of time than what is currently being priced in by the futures markets.” Wall Street is coming off a rocky week that saw all three major averages lose ground. The Dow fell 2.77% for its worst week since September. The S&P 500 dropped 3.37%, while the Nasdaq Composite shed 3.99%. Shares in the Asia-Pacific declined Monday as investors looked ahead to a Fed meeting and U.S. inflation data this week. Hong Kong’s Hang Seng index fell 2.2% to end off at 19,463.63, leading losses in the region. The Hang Seng Tech index shed 4.05% to close at 4,192.67. In Australia, the S&P/ASX 200 closed down 0.45% to stand at 7,180.8. Japan’s Nikkei 225 fell 0.21% to end at 27,842.33 while the Topix slid 0.22% to 1,957.33. South Korean benchmark Kospi closed down 0.67% at 2,373.02, and the Kosdaq dipped 0.59% to 715.22. The MSCI’s broadest index of Asia-Pacific shares outside Japan slipped 1.13%. Mainland China’s Shanghai Composite closed at 3,179.04 after losing 0.63%, and the Shenzhen Component was down 0.673%. Oil prices fell on Monday, deepening a multiweek decline, as a weakening global economy offset supply woes stemming from the closure of a key pipeline supplying the United States and Russian threats of a production cut. Brent crude futures were down 41 cents, or 0.5%, at $75.69 a barrel. U.S. West Texas Intermediate crude was at $70.91 a barrel, down 11 cents, or 0.15%. Gold prices edged lower on Monday as investors squared positions ahead of U.S. inflation data and a slew of central bank meetings across the world, especially the Federal Reserve. Spot gold was down 0.3% at $1,792.15 per ounce. U.S. gold futures fell 0.4% to $1,803.70.