Major U.S. index futures edged lower on Monday, reflecting the cautious mood from last week’s close. The tech sector could face additional pressure due to China’s plan to phase out U.S. chipmakers from government PCs and servers. Three upcoming Fed speeches this week may offer clues about future interest rate hikes.
Recap Of Last Week’s Market Activity
The week ending on March 22 saw a surge in trading activity after the Federal Reserve signaled its willingness to begin easing monetary policy from current levels. Despite inflation remaining elevated, Fed officials, led by Jerome Powell, hinted at three rate cuts this year. This announcement led to a market recovery, with the tech sector and small-cap stocks notably rebounding. However, as the Fed-related optimism waned towards the end of the week, the indices retreated slightly.
| Index | Performance (+/-) | Value |
| Nasdaq Composite | +2.85% | 16,428.82 |
| S&P 500 Index | +2.29% | 5,241.53 |
| Dow Industrials | +1.97% | 39,475.90 |
| Russell 2000 | +1.60% | 2,072.00 |
Insights From Analysts:
Louis Navellier, a fund manager, anticipates a potential correction following the strong gains of the first quarter. “Concerns about the market being stretched are inevitable with such strong gains in the first quarter of the year, with a few analysts’ year-end targets already reached,” he said. “We’re overdue for a correction, if only from rebalancing holdings, where the equity exposure has grown beyond the model weight.”
Conversely, Ryan Detrick of Carson Group remains bullish, stating that defensive stocks have yet to lead, a trend typically observed in bearish markets. In a bearish market, “the defensive stuff starts to lead, that’ll be a warning sign,” he said. He shared a chart showing defensives continuing to lag and said. “If and until this changes, I stay bullish.”
Futures Today
Futures Performance On Monday ( as of 7 a.m. EDT)
| Futures | Performance (+/-) |
| Nasdaq 100 | -0.55% |
| S&P 500 | -0.32% |
| Dow | -0.16% |
| R2K | -0.17% |
In premarket trading on Monday, the SPDR S&P 500 ETF Trust (NYSE:SPY) slid 0.26% to $519.84, and the Invesco QQQ ETF (NASDAQ:QQQ) declined 0.56% to $443.88, according to Benzinga Pro data.
Upcoming Economic Data:
The unfolding week is likely to see the release of a few housing market reports, a duo of consumer sentiment readings, durables goods orders data, weekly jobless claims data and a regional manufacturing activity data. The Bureau of Economic Analysis is scheduled to release its final fourth-quarter GDP data this week. Fed speeches will also remain in the spotlight.
Atlanta Fed President Raphael Bostic is scheduled to speak at 8:25 a.m. EDT, followed by Chicago Fed President Austan Goolsbee at 9:05 a.m. EDT and Fed Governor Lisa Cook at 10:30 a.m. EDT.
The Commerce Department is due to release the new home sales report for February at 10 a.m. EDT. Economists, on average, expect new home sales for the month to come in at 675,000 units, up slightly from 661,000 units in January.
The Treasury will auction three- and six-month Treasuries at 11:30 a.m. EDT and two-year notes at 1 p.m. EDT.
See also: Best Futures Trading Software
Stocks In Focus:
- Chipmakers Advanced Micro Devices, Inc. (NASDAQ:AMD) and Intel Corp. (NASDAQ:INTC) fell over 2% in premarket trading each amid rumors of China issuing guidelines to ban their processors from government PCs and servers.
- Tesla, Inc. (NASDAQ:TSLA) slid over 1% on an analyst downgrade and worries concerning sub-par first-quarter deliveries.
- Masimo Corp. (NASDAQ:MASI) jumped over 13% after the Wall Street Journal reported that activist investor Politan Capital Management, which last year won two seats on its board, is planning a second proxy battle for two more seats.
- United Airlines Holdings, Inc. (NASDAQ:UAL) fell over 4% after the Federal Aviation Administration said it is increasing oversight of the airliner to ensure that it is complying with safety regulations.
- McCormick & Company, Incorporated (NYSE:MKC), GameStop Corp. (NYSE:GME), nCino, Inc. (NASDAQ:NCNO), and Progress Software Corporation (NASDAQ:PRGS) are among the key companies due to report their quarterly results on Monday.
Commodities, Bonds, and Global Equity Markets:
Crude oil futures rose to $81.14 early Monday, while gold futures also saw modest gains. The 10-year Treasury bond yield remained around 4.2%.
Bitcoin (CRYPTO: BTC) traded up 2.84% at over $67,000. Sentiment in global markets was mostly negative, with Asian and European markets experiencing declines following last week’s Fed-induced rally.
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