Sentiment has soured ahead of the key inflation data that is due ahead of the market open on Friday, with the index futures pointing to a modestly lower opening. A fairly benign data could keep the upward trajectory intact ahead of next week’s key labor market data. Stocks are on track to finish September, a seasonally weaker month, on a positive note, and election uncertainty could weigh down on the market in the upcoming month. The focus would shift to the third-quarter reporting season in the latter half of October.

In premarket trading on Friday, the SPDR S&P 500 ETF Trust (NYSE:SPY) edged up 0.03% to $572.46 and the Invesco QQQ ETF (NASDAQ:QQQ) fell 0.08% to $489.09, according to Benzinga Pro data.

Cues From Last Session:

U.S. stocks advanced on Thursday as traders digested a slew of economic data, Chinese stimulus that set the Asian markets on fire and Micron Technology, Inc.’s (NASDAQ:MU) earnings. A sharp drawdown in the shares of Super Micro Computer, Inc. (NASDAQ:SMCI) on the back of the news of a Department of Justice probe tempered optimism toward the tech stocks.

The major indices opened sharply higher after separate reports showed jobless claims fell in the recent reporting week, durable goods orders remained flat, belying expectations for a decline, and the second-quarter GDP data was left unrevised at 3%.

The indices squandered the early gains but remained mostly above the unchanged line for the rest of the session before closing higher for the day.

The S&P 500 scored another record intraday and closing highs, with nine of the 11 S&P 500 sector classes closing higher. Material stocks advanced notably, while energy stocks came under significant selling pressure.

Insights From Analysts:

LPL Chief Economist Jeffrey Roach said in a note he anticipates a period of higher volatility among both bonds and equities during the present period of global uncertainty and softer growth outlook. “We expect volatility to remain elevated over the next few months, and believe a better entry point back into the longer-term bull market is likely,” he said.

The economist said the long and variable lag of monetary policy is not perfectly symmetrical, and it could take time for the monetary stimulus to filter down from Wall Street to Main Street. “Portfolio allocators should consider keeping a domestic bias during these periods of flux,” he added.

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Upcoming Economic Data:

Stocks In Focus:

Commodities, Bonds And Global Equity Markets:

Crude oil futures are weaker yet again, although more modestly than in the previous two sessions, and gold futures retreated modestly and traded just shy of the record. Bitcoin (CRYPTO: BTC) rallied over 3% over the past 24 hours and is fast approaching the next psychological resistance of $66K.

The yield on the 10-year Treasury note remained almost flattish with a slight negative bias at 3.785%.

In Asia, stocks in Hong Kong, Japan and China rose strongly and the Australian averages gained modestly, but major indices elsewhere settled mostly lower. China’s optimism continued to buoy sentiment in the mainland markets.

The European markets advanced in early trading as traders digested inflation data from some key countries in the region and other data.

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