Stock futures opened slightly changed Thursday night after a mixed session earlier, in which investors digested a wide range of mixed economic data and its implications for monetary policy.
Contracts on the S&P 500 embraced the flat line. Previously, both the blue-chip index and the Dow ended lower and fell from the session’s downturn at close to the market, but failed to break into positive territory.
The latest set of US economic data on Thursday paints a more optimistic picture than expected of the US consumer. August retail sales showed a surprising increase as consumers returned to consumer spending amid the latest wave of the Delta variant. And while weekly new unemployment claims rose in the Labor Department’s latest report, the level of new claims has remained near the lowest since March 2020.
Nevertheless, investors have been eyeing the latest data with ongoing caution about the outlook ahead, especially given the persistent uncertainty surrounding the coronavirus, supply chain challenges and next steps in monetary and fiscal policy.
“I think it’s really this tug of war right now that is going on, that is, there is still good news about the economy. In fact, in the last two days we have had some good regional Fed survey reports and today’s retail sales numbers. , “Mark Luschini, chief investment officer for Janney Montgomery Scott, told Yahoo Finance on Thursday.
“But at the same time, it is in the context of this general decline in growth that we have seen so far in the third quarter [and] concerns about the Delta variant. And we are, of course, facing prospects and discussions around taxes to fund fiscal stimulus programs and as well as a potential debate over the debt ceiling, “he added. So there are many things that create cross-currents for investors at the moment, which create this environment where you day after day flip-flop between cyclical and defensive without any real pattern being evoked by either. “
At the end of Thursday and with two weeks left in September, the S&P 500 was heading for its first monthly decline since January. Although the blue-chip index still has less than 2% from an all-time high, it has traded flat to slightly lower over the past few weeks as traders wait for the next catalysts.
“We’ve had a lot of back and forth, and I think that reflects a market that has grown by 20%, a lot has already been priced in,” John Lynch, chief investment officer at Comerica Wealth Management, told Yahoo Finance. “We are entering the quiet period before third quarter earnings. Although third quarter earnings will increase by 30%, they will be a third of what earnings did in the second quarter. So investors have a lot to work with.”
However, he added that equities still have the advantage of lack of competition in many other areas of the market, especially given the current monetary policy position.
“If you consider that the real interest rate is still negative, M2 or the money supply is doubling GDP, it is a bid for equities despite some uncertainty,” Lynch said.
18:13 ET Thursday: Stock futures open slightly changed
Here were the main movements in markets on Thursday night:
S&P 500 futures (ES = F): -3.75 points (-0.08%) at 4,470.50
Dow futures (YM = F): -14 points (-0.04%) to 34,735.00
Nasdaq futures (NQ = F): -11.25 points (-0.07%) to 15,506.50
Emily McCormick is a reporter for Yahoo Finance. Follow her on Twitter: @emily_mcck