US Futures Paint Gloomy Outlook For Fresh Trading Week As Data-Dependence Introduces Caution Ahead Of Key Main Street Readings, Fed Speeches

Zinger Key Points
  • U.S. stocks look set to extent the losses from Friday.
  • Caution could be the watchword ahead of key day releases, including Aug. jobs data, and Fed speeches scheduled for the week.

The major U.S. index futures are notably lower on Monday, signaling that stocks may be carrying over the downward momentum from Friday.

U.S. stocks closed out the week ended Aug. 26 with steep losses, dragged by the hawkish stance of the Federal Reserve. After a lackluster start to the week, the major averages picked up buying momentum on Wednesday and Thursday before Fed Chair Jerome Powell brought them all sharply lower on Friday.

The S&P 500 index, a broader gauge of U.S. stocks, ended the week down 4.04% at 4,057.66, pulling back toward its lowest level since the 4.023.61 hit on July 27. This marked the second straight week of losses for the average. The Dow Industrials blue chip average declined 4.2% for the week, ending at a one-month low of 32,283.40.

The tech-heavy Nasdaq Composite posted a weekly loss of 4.4% before ending at 12,141.71.

At the time of going to press, the Dow futures were down 0.82%, the S&P 500 futures were moving down 0.90% and the Nasdaq 100 futures were retreating 1.11%.

Credit Suisse analysts see investors’ focus for the week to be on the August employment report, the ISM manufacturing index, Conference Board’s consumer confidence data, and scheduled remarks from several FOMC voting members.

September could bring more weakness, going by historical performance for the month, several market watchers commented on Twitter. Data shared by trading platform Trend Spider showed that Apple Inc. AAPL declines 70% of the time in September. Given Apple has the biggest weighting in the S&P 500 Index, this does not bode well for the index.

Economic expert Raoul Paul sounded out caution regarding the dollar’s strength and its impact on risky assets.

“Personally, I think we get saved by weak economic data this week,” he commented.

See also: How Much $1,000 Invested In Apple, Amazon, Bitcoin, Gold After Friday's Plunge Would Be Worth Upon Return To All-Time Highs

On the economic front, the results of a regional manufacturing survey are due at 10:30 a.m. ET. The Dallas Federal Reserve’s general business activity index measuring manufacturing activity in Texas is expected to remain in negative territory at minus 12.3 in August. The reading, however, would mark an improvement from July’s 22.6.

On the corporate front, contract drug manufacturing organization Catalent, Inc. CTLT is scheduled to report its quarterly results before the market open.

Crude oil futures are rising modestly.

Among the global markets, Asian stocks pulled back notably on Monday, tracking Wall Street’s performance last Friday. The European markets are also deep in the red.

In premarket trading on Monday, the SPDR S&P 500 ETF Trust SPY was receding 0.92% to $401.60 and the Invesco QQQ Trust QQQ was moving down 1.11% to $304.03, according to Benzinga Pro data.

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Posted In: EarningsNewsFuturesPreviewsTop StoriesEconomicsFederal ReservePre-Market OutlookMarketsTrading IdeasJerome PowellNasdaq futuresS&P 500 futures
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