Stock

Market Snapshot: U.S. inventory futures inch increased after tough begin to the week

U.S. stock futures were a touch firmer Tuesday amid cautious trading following a bad start to the week.

How are stock-index futures trading

S&P 500 futures
ES00,
+0.02%
rose 8 points, or 0.2%, to 4011

Dow Jones Industrial Average futures
YM00,
+0.01%
added 61 points, or 0.2%, to 34047

Nasdaq 100 futures
NQ00,
+0.06%
climbed 23 points, or 0.2%, to 11829

On Monday, the Dow Jones Industrial Average
DJIA,
-1.40%
fell 483 points, or 1.4%, to 33947, the S&P 500
SPX,
-1.79%
declined 73 points, or 1.79%, to 3999, and the Nasdaq Composite
COMP,
-1.93%
dropped 222 points, or 1.93%, to 11240.

What’s driving markets

Wall Street was struggling to rebound from a rotten start to the week, after stronger-than-expected economic data in recent days raised fears about further rate rises by the Federal Reserve.

S&P 500 futures were barely changed on Tuesday, having suffered on Monday their worst session in a month following a robust survey of business condition in the U.S. service sector.

This followed Friday’s news that the jobs market was showing few signs that the Fed’s attempts to cool the economy by sharply raising borrowing costs were yet to have a dramatic impact.

“Markets are getting off to a shaky start this week, with solid U.S. economic data releases delaying investors’ hopes that the Fed might become more dovish in the months ahead,” said Stephen Innes, managing partner at SPI Asset Management.

“Ultimately it matters more where the Fed ends up and not how fast they get there, and the tighter-than-expected labour market combined with the boisterous business sentiment index gives more clout to the + 5 % terminal camp. As a result, equities are giving up hard-fought ground thanks to the concern about further rate hikes,” Innes added in a morning bulletin.

Technical analysts noted that the market’s latest relapse came after it failed once again to break above an established downtrend.

Pointing to a chart of the S&P 500, commentators at the MarketEar.com suggested that much of the recent rally off the mid-October low was powered by those investors short the market scrambling to cover their positions rather than any fundamental bullishness.


Source: MarketEar

“The crowd did it again, covering shorts in panic. We are once again below that 200 day (moving average on the S&P 500) that got so many people excited and we saw some bears throw in the towel. A close (on Monday) here or lower and things could get ‘dynamic’ to the downside. Don’t forget the market will become less and less liquid as we approach Christmas,” said MarketEar.

U.S. economic updates set for release on Tuesday include the trade deficit for October, due at 8:30 a.m. Eastern.

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