Stock futures were down slightly Sunday night after the market closed out the best month since 2020, as the market prepares for the uncertainty of another week of key earnings reports and economic data.
S&P 500 futures were down as low as 0.4%, Dow Jones Industrial Average futures fell as much as 133 points, or 0.4%, and Nasdaq 100 futures were down 0.4%.
Friday, all major indices closed up, making it the best month of the year for each, as the S&P 500 added 9.1%, the Dow tacked on 6.7%, and the Nasdaq added 12.4%. Each index posted the best month since 2020.
Chris Zaccarelli, chief investment officer for Independent Advisor Alliance said, “We are seeing a relief rally in the stock market, as pessimism reached extreme levels, and as longer-term interest rates have been coming back down.”
He added, “We believe the rally will last until later in the summer, but as stock prices rebound and it becomes increasingly clear that we are headed for a more typical recession (e.g. one with higher unemployment and nominal GDP dropping close to zero or negative), markets will again have another selloff. But until that time, enjoy the rally as it’s likely catching a lot of people off guard.”
Oil was down Sunday night as well. West Texas Intermediate futures were down 0.7%, to $97.91 a barrel. International standard Brent crude futures dropped 0.5% to $103.52 a barrel.
This week, investors await the release of earnings from companies such as Activision Blizzard, Devon Energy, Loews, Uber, Caterpillar, Starbucks, Eli Lilly, Amgen and others.
On Friday the Bureau of Labor Statistics will give more insight into the labor market, revealing if the job market is still running hot. So far this year economists seeking to claim the economy has not entered a recession have pointed to strong hiring and low unemployment. As other economic indicators have continued to post more and more worrisome numbers, the job market has held strong thus far.
Now that inflation has posted a 40 year high, and there have been two consecutive quarters of contracting economic growth, the jobs data will be vital to determining what exactly the economy is doing.
