US Futures Rise Ahead Of Key Inflation Reading
US equity futures gained as trade tensions eased and investors stuck to bets on Federal Reserve interest-rate cuts ahead of a key inflation reading later Friday.
Contracts on the S&P 500 were up about 0.3% after a tech-led rally on Wall Street put the benchmark on track for a second weekly gain of more than 1%. Futures on the Nasdaq 100 advanced 0.5%. Shares in Intel Corp soared in pre-market trading in New York after an upbeat revenue forecast. Newmont Corp. slumped after the precious-metals miner’s guidance disappointed investors.
Indian Investors Eyeing US Market Trends
Indian investors are closely watching the US market trends, as they can have a significant impact on the Indian stock market. The Sensex and Nifty are often influenced by the global market trends, and the US market is one of the most closely watched.
With money markets pricing in a Federal Reserve rate cut next week and Treasuries set for their best monthly performance since February, investors will likely look past any evidence of stubborn inflation in Friday’s consumer price index report, which comes after a more-than-three-week data vacuum due to the US government shutdown. Treasury yields and a gauge of the dollar were steady.
Expert Insights
“Whatever the print looks like, it won’t deter the FOMC from delivering a 25 basis-point cut next week, or at the December meeting, even if there will probably be some knee jerk volatility as the data crosses,” said Michael Brown, a senior research strategist at Pepperstone Group Ltd.
The Stoxx Europe 600 index erased gains amid mixed earnings and contrasting economic data from Germany and France, the region’s two biggest economies. While business activity in Germany surged, France’s composite purchasing managers’ index unexpectedly fell. The country’s CAC 40 stock index declined.
European Market Trends
Among companies reporting earnings in Europe, French drugmaker Sanofi SA, UK lender NatWest Group Plc, Swiss cement producer Holcim AG and Swedish defense firm Saab AB gained after beats. Aluminum supplier Norsk Hydro ASA and Dutch lights manufacturer Signify NV dropped after missing analysts’ estimates.
The strong earnings season so far has helped markets to ride out geopolitical and trade tensions. With nearly a quarter of the reporting done, year-on-year growth in earnings-per-share has been 4% in Europe and 14% in the US, better than expected, according to Barclays Plc strategists. The real test will come with big-tech results starting next week, they said. Alphabet Inc. and Meta Platforms Inc. are slated to report on Oct. 29 and Apple Inc. the day after.
Investor Sentiment
“We do not think that we are out of the volatility period and market sentiment still feels fragile,” said Mohit Kumar, chief economist and strategist at Jefferies International Ltd. “Investor positioning has shown some signs of cleanup, but overall positioning still remains on the long side. Thus, we are keeping our low-risk mode for now, while maintaining our medium term bullish view.”
Market sentiment was helped by a White House announcement that President Trump will meet his Chinese counterpart Xi Jinping, a chance for cooler heads to prevail after a recent flare-up in trade tensions. The two leaders will talk next Thursday on the sidelines of the Asia-Pacific Economic Cooperation summit, their first face-to-face meeting since Trump returned to power.
Trade Tensions
“The confirmation of a Xi–Trump meeting gave markets a clear reason for a relief rally today,” said Hebe Chen, an analyst at Vantage Markets in Melbourne. “Not from hopes of warmer U.S.–China relations ahead, but from the perception that any progress is better than stalemate, and that a new deal before the truce deadline now appears more attainable.”
Other trade conflicts continue to simmer, however. Trump halted all tariff negotiations with Canada, citing a Canadian advertisement against his signature tariffs plan featuring the voice of former President Ronald Reagan. Canadian bonds fell and the currency weakened.
Commodity Prices
Brent crude oil held above $65 a barrel after rallying more than 5% as US President Donald Trump imposed sanctions on Russian producers. Gold is set to snap a nine-week winning run, following a sharp correction as the market reassessed a rally that had pushed the metal into overbought territory. Bullion slipped below $4,100 an ounce on Friday, putting it on track for a weekly decline of more than 3%, the most since May.
For Indian investors looking to invest in the US market, it is essential to stay updated on the latest market trends and news. You can visit our website to get the latest updates on the US stock market and other global market trends.
Key Takeaways
- US equity futures gained as trade tensions eased and investors stuck to bets on Federal Reserve interest-rate cuts ahead of a key inflation reading later Friday.
- Contracts on the S&P 500 were up about 0.3% after a tech-led rally on Wall Street put the benchmark on track for a second weekly gain of more than 1%.
- The Stoxx Europe 600 index erased gains amid mixed earnings and contrasting economic data from Germany and France.
- Market sentiment was helped by a White House announcement that President Trump will meet his Chinese counterpart Xi Jinping.
- Other trade conflicts continue to simmer, with Trump halting all tariff negotiations with Canada.
Stay tuned for more updates on the US market and other global market trends. You can also visit our website to get the latest news and updates on the Indian stock market.
