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Pre-Market Futures Lower Ahead of JOLTS, U.S. Auto Sales

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Tuesday, April 2nd, 2024

Markets through the first trading day of the week are demonstrating they don’t have much appetite to push all-time highs (on the S&P 500) even higher. This may or may not have to do with waiting until various jobs reports hit the tape — the last of which being the biggest: the Employment Situation, from the U.S. government, Friday morning — but in any case, pre-markets are down following a mostly down day in the markets yesterday.

Today brings us the Job Openings and Labor Turnover Survey (JOLTS) for February, expected to tick down to 8.8 million from the previous month’s 8.9 million. This is a million fewer JOLTS headline figures than we saw back in April of last year (9.9 million), which was roughly 2 million below the March 2022 headline number of 12.2 million. That said, current levels are still notably ahead of the roughly 7.2 million we were seeing consistently pre-Covid.

Factory Orders come out after today’s open, and expected to have grown a full +1.0% for February from the prior month’s -3.6%. This is a day after ISM Manufacturing for March pushed back over the 50 mark (50.3%), and Construction Spending for February, which was much lower than expected: -0.3% versus +0.7% projected. These data points are incremental, but they do help articulate development on the productivity side of the U.S. economy.

Also today, Fed Governor Michelle Bowman makes an appearance, as do Fed Presidents Loretta Mester (Cleveland) and Mary Daly (San Francisco). This will be a big week to garner Fed member opinion, as the next Federal Open Market Committee (FOMC) meeting begins four weeks from today, with another “no change” on interest rates the following day. FOMC members will likely be prepared to answer questions on the likelihood the Fed pushes the first (of three) rate cuts in 2024 past June.

UnitedHealthcare (UNH - Free Report) is helping take the Dow lower in pre-trading today, as a report was issued that the company’s Medicare Advantage payments are no longer expected to be as high as previously hoped. The average reimbursement rate came in at +3.7%, below what analysts were looking for. Medicare Advantage’s profitability has been a source of some irritation for UnitedHealth shareholders — as well as similar healthcare providers like Humana (HUM - Free Report) — for the past couple years, with no signs of notably firming price points.

Finally, expect U.S. auto sales and deliveries figures to begin filing in today. Traditionally, this is not a major news dump at the top of the hour, but more of a steady trickle of data throughout the trading day. Already we have heard from EV maker Rivian (RIVN - Free Report) , which reported Q1 sales in-line with estimates. Shares are down on the news, but they’re down across market indices ahead of the opening bell: the Dow is currently -350 points, -40 at the S&P and -172 points for the tech-heavy Nasdaq.

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