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Following a solid trading week that saw the Dow put up its best numbers since June, pre-market futures are back down again to start a new trading week. Currently, charts do not look convincing that last week’s new plateau is going to hold. The Dow and S&P 500 are down roughly 10 points at this hour, while the Nasdaq is -80 points. This indicates some downward pressure on tech stocks again.
Last week’s nonfarm payrolls report from the U.S. government on Friday put something of a damper on stocks to end last week, and some residue may remain. Labor Force Participation, for one thing, looks frustratingly stuck at a mediocre 61.6%, even with 5 million fewer jobs filled than prior to the pandemic. Perhaps Covid fears are still keeping some people out of the workforce, but perhaps there’s something more fundamental going on in the labor market that will take longer to remedy.
Concerns about the Capitol Hill raising the debt limit doesn’t seem to be generating a lot of heat currently, although not passing two massive infrastructure bills by the end of the year — something that has begun to get baked into analyst expectations for improvements to the U.S. economy going forward — might. Not just goods-producing and blue-collar labor employment such as bridge builders, but also daycare services for working families. Should these not see passage, expect to see lots of downward revisions.
We also will soon be bracing for a Fed tapering program, which will eventually see the removal of $120 billion in assets purchased no longer providing a huge reservoir of liquidity. The Fed has experience with these sorts of maneuvers, so big shocks to the market are not expected — though you never know. It’s not too far back in our rear view that there was a “taper tantrum” that sent stocks (temporarily) spiking downward.
There is also only so much the U.S. will be able to manage the global marketplace. Bureaucratic overhauling in China are meeting energy price spikes in Europe — both of which may aggravate global trade already strained by supply bottlenecks. Again, the ramp up from the global pandemic is a major consideration in this scenario, although within that realization also lies the glimmer of hope: vaccinations and other treatments are beginning to put Covid on the ropes, which is a very good thing.
Because today is Columbus Day/Indigenous Peoples Day, banks are closed although Wall Street is open. This is what many consider to be the “first week” of Q3 earnings season (although Zacks Director of Research Sheraz Mian always points out Q3 earnings season already began a couple weeks ago), but due to the holiday, no companies will be reporting until tomorrow. Wednesday brings us both JPMorgan ((JPM - Free Report) and Delta Air Lines ((DAL - Free Report) .
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Market Futures Lower Ahead of Opening
Following a solid trading week that saw the Dow put up its best numbers since June, pre-market futures are back down again to start a new trading week. Currently, charts do not look convincing that last week’s new plateau is going to hold. The Dow and S&P 500 are down roughly 10 points at this hour, while the Nasdaq is -80 points. This indicates some downward pressure on tech stocks again.
Last week’s nonfarm payrolls report from the U.S. government on Friday put something of a damper on stocks to end last week, and some residue may remain. Labor Force Participation, for one thing, looks frustratingly stuck at a mediocre 61.6%, even with 5 million fewer jobs filled than prior to the pandemic. Perhaps Covid fears are still keeping some people out of the workforce, but perhaps there’s something more fundamental going on in the labor market that will take longer to remedy.
Concerns about the Capitol Hill raising the debt limit doesn’t seem to be generating a lot of heat currently, although not passing two massive infrastructure bills by the end of the year — something that has begun to get baked into analyst expectations for improvements to the U.S. economy going forward — might. Not just goods-producing and blue-collar labor employment such as bridge builders, but also daycare services for working families. Should these not see passage, expect to see lots of downward revisions.
We also will soon be bracing for a Fed tapering program, which will eventually see the removal of $120 billion in assets purchased no longer providing a huge reservoir of liquidity. The Fed has experience with these sorts of maneuvers, so big shocks to the market are not expected — though you never know. It’s not too far back in our rear view that there was a “taper tantrum” that sent stocks (temporarily) spiking downward.
There is also only so much the U.S. will be able to manage the global marketplace. Bureaucratic overhauling in China are meeting energy price spikes in Europe — both of which may aggravate global trade already strained by supply bottlenecks. Again, the ramp up from the global pandemic is a major consideration in this scenario, although within that realization also lies the glimmer of hope: vaccinations and other treatments are beginning to put Covid on the ropes, which is a very good thing.
Because today is Columbus Day/Indigenous Peoples Day, banks are closed although Wall Street is open. This is what many consider to be the “first week” of Q3 earnings season (although Zacks Director of Research Sheraz Mian always points out Q3 earnings season already began a couple weeks ago), but due to the holiday, no companies will be reporting until tomorrow. Wednesday brings us both JPMorgan ((JPM - Free Report) and Delta Air Lines ((DAL - Free Report) .