US stock index futures rose during overnight trade on Monday, after key moving averages during regular trading ranged between gains and losses, as the market awaits key inflation data later this week.
Futures contracts, which are linked to the Dow Jones Industrial Average, gained 0.1%. S&P 500 futures were up 0.16%, while Nasdaq 100 futures were up 0.19%.
During regular trading, the S&P 500 lost 0.37%, while the Nasdaq Composite lost 0.58%. Both traded higher earlier in the day before reversing in the last hour of trading. However, each index managed to close above its worst level of the session.
The Dow Jones Industrial ended Monday's trading session just 1 point higher. At one point, the 30-stock benchmark had added 235 points. From the day's lows, the Dow is down about 95 points.
"US stocks will struggle for direction until recent inflation rocks market expectations of how aggressively the Fed will tighten what is still considered an overvalued stock market," said Edward Moya of Oanda.
On Thursday, the Labor Department will release CPI data for January. The reading follows a stronger-than-expected jobs report in January, which led to speculation that the Federal Reserve could be more aggressive in raising interest rates. Inflation data is expected to show that prices rose 0.4% in January, up 7.2% yoy.
Bank of America said Monday the Federal Reserve could raise seven quarters of a percentage point this year.
"Market turbulence continues as the combination of Fed policy uncertainty and economic change remains in focus," Canaccord Genuity said in a note to clients on Monday.
“Unfortunately, this is the environment we will find ourselves in for a while longer as the mid-cycle monetary and economic transition unfolds.”
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Communication services was the worst-performing sector in the S&P 500 on Monday, down 2.2%, while shares in Facebook parent Meta fell 5%. Shares of the social media giant are down 28% this month after the company's disappointing earnings report.
Google parent Alphabet slipped 2.9%, while Twitter, Match Group and Netflix all lost around 2%.
"Tech stocks are no longer a one-way street as investors pare losses and now focus on valuations, competition and the long-term outlook," added Oanda's Moya.
The earnings season resumes on Tuesday, with Pfizer, Harley-Davidson, Lyft, Chipotle and Yum China among the names expected to report quarterly earnings.
As of Monday afternoon, 281 S&P 500 components have reported, with 78% beating earnings estimates and 77% beating sales expectations, according to FactSet.
Peloton is also set to report earnings Tuesday after the market close at a turbulent time for the company. The stock rose 20.9% on Monday after reports the company could be a takeover target.