Business

US stock futures slip after the S&P 500 logs a record high, as traders count down to Fed Chair Jerome Powell’s speech

Jerome Powell hearing
Fed Chair Jerome Powell is set to give a major speech on Friday.

  • US stock futures dipped Thursday after the S&P 500 notched up another record high the previous day.
  • Investors are bracing for Friday’s major speech from Fed Chair Jerome Powell, and for economic data on Thursday.
  • Powell’s words will be scrutinized for any sign about when the Fed might start cutting back its support for the economy.
  • Sign up here for our daily newsletter, 10 Things Before the Opening Bell.

US stock futures slipped on Thursday after the benchmark S&P 500 stock index closed at another record high, as investors awaited the release of economic data and looked ahead to a key speech by Federal Reserve Chair Jerome Powell.

S&P 500 futures were down 0.09% after the benchmark rose 0.22% to an all-time high on Wednesday. Nasdaq 100 futures were 0.19% lower, after the tech-heavy index also closed at a new high. Dow Jones futures were roughly flat.

In Europe, the continent-wide Stoxx 600 fell 0.48% in early trading. Stocks moved broadly lower in Asia overnight, with China’s CSI 300 losing 1.97% “as investors continue to ponder the implications of the country’s regulatory agenda,” Chris Scicluna of Daiwa Capital Markets said.

Stocks have consistently ground higher in the US in 2021, with the S&P 500 achieving 51 record highs. Huge amounts of government stimulus, the economic reopening, and the spread of vaccines have boosted equities.

Yet some investors are worried that inflation is becoming dangerously hot and that growth could be peaking. Economic data due out on Thursday should be closely watched. The second estimate of second-quarter GDP is set to be released, alongside weekly jobless claims figures from last week.

However, the main event for traders and investors this week is Powell’s speech at the virtual Jackson Hole Symposium of central bankers on Friday. The Fed chair’s words will be picked apart for any signs about when the central bank will start “tapering,” or cutting back, its bond purchases.

Analysts are divided about what exactly to expert from Powell, however. Paolo Zanghieri, senior economist at Generali Investments, said: “Despite the strong expectations, Fed Chair Powell’s speech at the Jackson Hole conference will likely be short on details on tapering the Fed’s asset purchases amid persistent risk from rising COVID cases and economic uncertainties.”

Bond yields rose sharply on Wednesday, with Jim Reid of Deutsche Bank saying the jump came “as investors considered the potential pace of tapering over the coming months.”

The key 10-year US Treasury yield, which moves inversely to the price, was roughly flat at 1.341% on Thursday, having stood below 1.3% on Wednesday. The dollar index rose 0.08% to 92.90.

In the oil markets, Brent crude slipped back 0.84% to $70.68 a barrel after a solid run higher. WTI crude, the US benchmark price, declined 0.98% to $67.69 a barrel.

Bitcoin slipped further after crossing the $50,000 level earlier in the week. The world’s biggest cryptocurrency was down 3.6% to $46,947 on Thursday.

Read the original article on Business Insider

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