Sep 18, 2023: U.S. stock futures traded marginally higher Monday, starting a fresh week on a cautious note as investors look forward to a highly-anticipated Federal Reserve policy meeting.
By 06:35 ET (10:35 GMT), the Dow Futures contract was up 35 points, or 0.2%, S&P 500 Futures traded 5 points, or 0.1%, higher and Nasdaq 100 Futures climbed 25 points, or 0.2%.
The Dow Jones Industrial Average managed to eke out a small increase last week, while the broad-based S&P 500 and tech-heavy Nasdaq Composite slipped for the second consecutive week.
Fed meeting looms large
The latest policy-setting meeting by the U.S. Federal Reserve is likely to dominate activity this week, with the two-day get together scheduled to conclude on Wednesday.
The U.S. central bank is widely expected to keep interest rates steady at a range of 5.25% to 5.50%, and thus investors will be looking more for clues from policymakers about their plans for borrowing costs during the rest of the year.
Data released last week saw consumer prices record the biggest jump in 14 months in August, but this was largely down to higher petrol costs, as the underlying figure decelerated to its slowest rate in almost two years.
“As with the June hold decision, the Fed is set to suggest that the decision should be interpreted as part of its process of a slowing in the pace of rate hikes rather than an actual pause,” said analysts at ING, in a note. “While inflation is moderating, it is still too high and with the jobs market remaining very tight and activity holding firm, the Fed can’t take any chances.”
The data slate is largely empty Monday, with only the NAHB housing index due for release, while investors will also be looking for progress in talks to avoid the fourth partial U.S. government shutdown in a decade.
Negotiators to resume auto strike talks
Negotiators representing the auto giants – General Motors (NYSE:GM), Ford (NYSE:F) and Stellantis (NYSE:STLA) – are set to resume talks with the United Auto Workers union later Monday, seeking to end one of the most crippling strikes in decades.
The strikes have halted production at three plants in Michigan, Ohio and Missouri that produce the Ford Bronco, Jeep Wrangler and Chevrolet Colorado, along with other popular models.
Crude continues to rally on supply tightness
Oil prices headed higher Monday, continuing to rally on the back of expectations of a tighter market ahead of a series of central bank policy-setting meetings this week.
The crude benchmarks have risen over 30% over the past three months following supply cuts from Saudi Arabia and Russia, which could push the market into a substantial deficit in the fourth quarter.
Traders will be watching decisions and commentary by central banks, including the U.S. Federal Reserve, this week on interest rate policies, and key economic data out of China.
By 06:35 ET, the U.S. crude futures traded 0.6% higher at $90.58 a barrel, while the Brent contract climbed 0.6% to $94.47.
Additionally, gold futures rose 0.1% to $1,948.15/oz, while EUR/USD traded 0.2% higher at 1.0671.
Source Courtesy: Investing.com