How worried should investors be about a pullback?
Former White House National Economic Council chief economist Joseph LaVorgna, Kingsview Wealth Management CIO Scott Martin and Peapack Private Wealth Management managing principal David Dietze weigh in on today’s markets and inflation.
U.S. equity futures are pointing to a slightly higher open when trading begins on Wall Street.
The major futures indexes suggest a gain of 0.1%.
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Wall Street benchmarks extended losses on Thursday amid uncertainty over rising coronavirus cases and the risks to pandemic recoveries.
The S&P 500 fell 0.3% to 4,360.03. The benchmark index is now on pace for its first weekly loss in four weeks.
|I:DJI||DOW JONES AVERAGES||34987.02||+53.79||+0.15%|
|I:COMP||NASDAQ COMPOSITE INDEX||14543.133355||-101.82||-0.70%|
The tech-heavy Nasdaq slid 0.7% to 14,543.13. The Dow Jones Industrial Average bucked the trend and bounced back after being down much of the day. The blue-chip index gained 0.2% to 34,987.02.
The week ends with two main economic reports.
The Commerce Department reports consumer spending for June. Economists surveyed by Refinitiv anticipate retail sales to slip 0.4% month-over-month, an improvement from a steeper-than-expected decline of 1.3% in May. Excluding the automotive component, spending is seen rising 0.4% in June after skidding 0.7% the prior month.
The University of Michigan releases its preliminary index of consumer sentiment for July. The Refinitiv estimate is 86.5, one point above June’s final reading of 85.5.
JOBLESS CLAIMS FALL TO PANDEMIC-ERA LOW
A busy week for financial earnings wraps up with brokerage Charles Schwab and asset manager State Street Corp. reporting ahead of Friday’s opening bell. Also watch for numbers from railroad operator Kansas City Southern.
The Bank of Japan kept its policy settings intact Friday but downgraded its growth forecast for the current fiscal year slightly, to 3.5%-4% from 3.5%-4.4%. It said the outlook for the world’s No. 3 economy was "highly unclear" and depends on how the COVID-19 situation unfolds.
Tokyo's Nikkei 225 index lost 0.9%, Hong Kong's Hang Seng rose 0.3% and China's Shanghai Composite index declined 0.7%.
In Europe, London's FTSE added 0.5%, Germany's DAX gained 0.3% and France's CAC rose 0.4%.
The yield on the 10-year Treasury note rose to 1.32% from 1.30% late Thursday.
POWELL DEFENDS FED'S INFLATION STANCE AS GOP LAWMAKERS CAST DOUBT
On Thursday, Federal Reserve Chair Jerome Powell delivered his second day of testimony before Congress. He reiterated that signs of inflation should ease or reverse over time, as the U.S. emerges from an unparalleled economic reopening following the pandemic-induced recession.
The government said Wednesday that inflation at the wholesale level jumped 1% in June, pushing price gains over the past 12 months up by a record 7.3%. That followed a report a day earlier showing consumer prices posted the biggest 12-month gain in 13 years.
New data on applications for unemployment benefits signaled the labor market continues to improve. The Labor Department said Thursday that unemployment claims fell by 26,000 last week to 360,000, the lowest level since the pandemic struck last year.
More companies released their latest quarterly earnings Thursday.
Morgan Stanley rose 0.2% after reporting a 10% rise in quarterly profits from a year earlier.
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In other trading Friday, U.S. benchmark crude oil lost 22 cents to $73.41 per barrel in electronic trading on the New York Mercantile Exchange. It gave up $1.48 to $71.65 per barrel on Thursday. Brent crude, the international pricing standard, shed 19 cents to $73.28 per barrel.
The Associated Press contributed to this report.
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