Futures are falling as investors caution ahead of inflation data

(Reuters) – U.S. stock index futures remained subdued on Friday ahead of new inflation data next week, amid recent economic data that fueled fears that interest rates could remain higher for longer.

Stronger-than-expected service activity and a drop in weekly jobless claims reignited fears of increased interest rates among market participants, pushing the S&P 500 and Nasdaq lower on Thursday.

On the radar is the August consumer price index, due on September 13th, followed by the Federal Reserve’s monetary policy decision on September 20th.

“Although our base case assumes there will be no further interest rate hikes this cycle, we expect economic uncertainty to keep equity markets volatile and volatile in the coming months,” said Mark Haefele, chief investment officer at UBS Global Wealth management.

According to the CME FedWatch Tool, money markets see a 93 percent chance that interest rates will remain at current levels in September, while pricing in a 55.4 percent chance of a pause in rate hikes at the November meeting.

Apple shares were flat in premarket trading after a two-day selloff weighed on U.S. stocks following news that Beijing ordered central government employees to stop using iPhones at work in recent weeks.

Another report on Friday said China’s restrictions will be expanded to include local governments and state-owned companies.

Morgan Stanley said the restrictions would result in a 4% drop in sales at most, suggesting the recent selloff in the iPhone maker’s shares was “excessive.”

At 5:31 a.m. ET, Dow E-minis were down 77 points, or 0.22%, S&P 500 E-minis were down 11.75 points, or 0.26%, and Nasdaq E-minis were down 11.75 points, or 0.26% 100 were down 45 points or 0.29%.

Investors also digested mixed comments from several Fed spokespeople on Thursday.

New York Fed President John Williams kept his options open for future interest rate policy. Dallas Fed President Lorie Logan said that while it “may be appropriate” to forego a rate hike at the upcoming meeting, further tightening of monetary policy may be necessary.

Further comments from policymakers are planned later in the day, including from Fed Vice Chairman for Supervision Michael Barr.

Among individual stock moves, Faraday Future Intelligent Electric rose 14.4% premarket. The electric vehicle maker claimed it was trying to spread misinformation and manipulate market sentiment.

DocuSign rose 2.7% as the e-signature product provider beat second-quarter earnings estimates and raised its full-year revenue forecast.

(Reporting by Shristi Achar A in Bengaluru; Editing by Arun Koyyur)

https://finance.yahoo.com/news/futures-fall-investor-caution-ahead-095258878.html Futures are falling as investors caution ahead of inflation data

Russell Falcon

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