S&P 500 futures fell slightly ahead of higher retail gains ahead of the Thanksgiving holiday

S&P 500 futures fell slightly ahead of higher retail gains ahead of the Thanksgiving holiday
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Traders on the NYSE floor, Oct 2, 21, 2022.

Source: NYSE

S&P 500 futures fell slightly Sunday evening ahead of another retail earnings batch that will kick off a shortened week for the Thanksgiving holiday.

Futures linked to the broad market index were 0.1% lower. Dow Jones Industrial Average futures fell 38 points, or 0.1%. Nasdaq 100 futures traded in a straight line.

Each of the main averages posted a bullish day but a bearish week in the previous trading session. The Dow rose nearly 200 points, or 0.6%. The S&P rose 0.5% and the Nasdaq Composite finished just 0.01% above the straight line.

Investors are pondering the strength of the recent bear market rally, which began with the October consumer price index reading earlier in the month and accelerated slightly with last week’s wholesale price reading. Last week, traders hung on messages from Federal Reserve officials who were less impressed with the numbers and reassess their optimism about the possibility of slowing inflation.

Ed Yardeni of Yardeni Research said that in his view, it was in October 2019. The bottom was 12, and the S&P 500 could rise to 4,300 by the end of the year, he told CNBC on Friday night’s “Closing Bell: Overtime.” The benchmark index currently sits at 3,965.34.

“The resilience of the economy that made the biggest difference in the market was amazing,” he said. “Everyone is debating whether we’re going to have a soft landing or a hard landing – no landing in the meantime. The consumer didn’t get the recession rating and continues to spend.”

Retail sales rose in October, but at the enterprise level, Target reported slowing demand and announced it would lay off 10,000 of its employees, despite Amazon, Home Depot and Walmart reporting strong results.

“Despite what holiday season spending might suggest, retail stocks are in the top three in November, but in the bottom third in December and middle in January,” said Liz Young, SoFi’s chief investment strategist. said in a note this weekend.

“Seasonality has its place in market analysis and has some predictive power. But the power of the economic cycle is stronger no matter what time of the year it is,” he added. “With the Fed rate hike of 375 basis points so far, the inverted yield curve, spikes in inflation and commodity prices still part of the narrative, we can all conclude that we are late in the economic cycle.”

With this historically quiet week ahead of Thanksgiving, investors will be busy with another batch of retail earnings to digest before the start of the post-holiday shopping season. Best Buy, Nordstrom, Dick’s Sporting Goods, and Dollar Tree are among the companies on deck.

Investors will also receive the minutes of the last Federal Reserve meeting, along with economic reports such as durable goods, new home sales, unemployment claims, and consumer confidence.

next week is the short one. Sunday will be closed Thursday for Thanksgiving. On Friday, the stock markets will close at 1 PM ET and the bond market will close at 2 PM ET.

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